Eldorado Gold Stock Drops on Foran Mining Acquisition News

Key Acquisition Details

Eldorado Gold Corporation's stock, trading as EGO on the NYSE, declined 8.2% following the announcement it would acquire Foran Mining Corporation. The all-stock and cash transaction is valued at approximately C$3.8 billion.

Transaction Overview

The deal aims to create a combined gold-copper mining entity. Foran shareholders are set to receive 0.1128 Eldorado shares plus $0.01 in cash for each Foran share. This valuation represents no premium to Foran’s recent closing price. Upon completion, existing Eldorado and Foran shareholders will hold approximately 76% and 24% of the combined company, respectively.

Strategic and Market Impact

The merged operation projects production of 900,000 gold equivalent ounces in 2027 from two key development projects in Greece and Canada, both scheduled for commercial production by mid-2026. The move diversifies Eldorado's portfolio across gold, copper, and other metals in Canada, Greece, and Türkiye. The combined firm expects to generate $2.1 billion in EBITDA in 2027.

Summary

The acquisition is positioned to create a stronger growth company with significant near-term cash flow potential. The transaction is expected to close in the second quarter of 2026, subject to standard shareholder and regulatory approvals.

FAQ

Q: Why did Eldorado Gold's stock price fall?
A: The stock fell 8.2% after the acquisition announcement. The deal offered no premium to Foran Mining's recent share price, which can trigger a negative market reaction for the acquirer.

Q: What is the total value of the acquisition?
A: The deal to acquire Foran Mining is valued at approximately C$3.8 billion.

Source: Investing.com