TORONTO - Rio Alto Mining Ltd. (TSX:RIO) and Sulliden Gold Corp. Ltd. say they plan to merge to create a new mid-tier gold producer with operations focused in Peru.
The mining companies say the value of the transaction is about $300 million and combining the two companies will result in near-term production potential of about 300,000 ounces of gold per year.
The merger would combine Rio Alto's La Arena gold oxide mine and adjoining sulphide copper-gold deposit in Peru with Sulliden's Shahuindo gold development project located in Cajabamba in the northern part of that country.
"This transaction represents a logical combination for Rio Alto given the complementary nature and proximity of our respective operations," Rio Alta president and CEO Alex Black said in a news release on Wednesday.
The merger between Rio Alta and Sulliden Gold (TSX:SUE) is expected to close this summer.