The deal, announced on Monday (Jan. 26), includes the sale of Hecla Québec, a wholly owned subsidiary of Hecla that owns the Casa Berardi mine and related exploration properties.
Under the terms of the agreement, Hecla expects to receive up to $593 million through a mix of upfront cash, equity, deferred payments and contingent consideration.
Hecla will receive $160 million in cash at closing, along with approximately 65.7 million shares of Orezone common stock, representing approximately 9.9 percent of Orezone’s outstanding pro forma shares, currently valued at approximately $112 million.
In addition, Hecla is expected to receive US$80 million in deferred cash payments, split into US$30 million payable 18 months after closing and US$50 million payable after 30 months.
The remaining compensation is conditional and could total up to $241 million.
It includes up to $211 million in production-based royalty payments tied to future open-pit production, calculated at $80 per ounce for the first 500,000 ounces of gold and at $180 per ounce thereafter.
Hecla could also receive a payment of $20 million upon the granting of certain permits, as well as up to $10 million linked to a gold price of more than $4,200 per ounce.
The transaction is backed by Franco-Nevada (TSX:FNV,NYSE:FNV), which Orezone said is a sponsor of the takeover.
“The sale of Hecla Quebec represents a significant milestone in Hecla’s transformation as we focus capital allocation and operational focus on our world-class silver portfolio,” said Rob Krcmarov, president and CEO of Hecla.
For Orezone, the acquisition marks a major expansion into Canada and adds a producing gold mine to its portfolio. The company said Casa Berardi will complement its Bomboré project in Burkina Faso and provide diversification in a jurisdiction known for its stable mining regulations and established infrastructure.
“This transaction marks a significant inflection point for Orezone as it adds a proven, cash-generating asset to our portfolio and provides asset diversification in a Tier 1 jurisdiction,” said Patrick Downey, president and CEO of Orezone.
Casa Berardi is an underground open-pit mine in the Abitibi region of Québec that has been in operation since the late 1980s. To date, it has produced more than 3.2 million ounces of gold.
At the end of 2024, proven and probable reserves were 1.3 million ounces, with additional measured, indicated and inferred resources to support future operations.
Casa Berardi’s 2026 gold production guidance is between 83,000 and 91,000 ounces.
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Securities Disclosure: I, Giann Liguid, have no direct investment interest in any company mentioned in this article.
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