Nordgold Announces Formal Commencement of All-Cash Offer for Northquest

Amsterdam, Netherlands, 27 April 2016 - Nord Gold N.V. (“Nordgold” or the “Offeror”, LSE: NORD), the internationally diversified low-cost gold producer, announces that on 26 April 2016 it formally commenced its offer (the “Offer”) to acquire all of the outstanding common shares (the “Shares”) of Northquest Ltd. (“Northquest”) that it does not own at a price of CAD$0.253 per Share (the “Consideration”). The Offer values Northquest at approximately CAD$27.3 million (approximately US$21.6 million) on an undiluted basis.

Nordgold previously announced on 15 December 2015 its intention to make the Offer following completion of a formal valuation in respect of the Shares. In connection with the Offer, Nordgold yesterday mailed an offer and take-over bid circular, letter of transmittal and notice of guaranteed delivery (the “Offer Materials”) to shareholders of Northquest which it filed yesterday with the Canadian securities regulatory authorities in accordance with applicable laws.

The Offer is open for acceptance until 5:00 p.m. (Toronto time) on June 1, 2016, unless the Offer is extended or withdrawn.

The Consideration represents:

  • a 25 percent premium based on the volume weighted average prices of the Shares for the 20 trading days ending on November 23, 2015, the last trading day before Nordgold’s ownership of the Shares increased to above 50% which triggered Nordgold’s obligation to make a take-over bid in accordance with the subscription agreement dated June 1, 2015 between Northquest and Nordgold;
  • a 15 percent premium based on the closing price of the Shares on the TSX-V on December 11, 2015, the last trading day before Nordgold’s announcement of its intention to make the Offer; and
  • a 10 percent premium based on the closing price of the Shares on the TSX-V on April 25, 2016.
  • The Offer is within the range of the fair market value of the Shares as of 8 April 2016 determined by Beacon Securities Limited, an independent valuator selected by the special committee of independent directors of Northquest to prepare a formal valuation of the Shares in accordance with applicable Canadian securities legislation. The valuation report is included in its entirety in the offer and take-over bid circular.

    Northquest is the 100% owner of the Pistol Bay Gold Project, a high grade exploration project located in Nunavut Territory, the northern Canada, on the west coast of Hudson Bay. The Pistol Bay property consists of 860 square kilometers of mineral rights within the underexplored Rankin-Ennadai greenstone belt. Within Arctic Canada, the Project is favorably located within the Arctic Circle with existing infrastructure and the project forms a part of Nordgold’s extensive international exploration pipeline. In April 2016, the Pistol Bay Maiden Inferred Resources of 739 koz of gold at 2.95 g/t were announced.

    The Offer is made only for the Shares and is not made for any options, warrants or other rights to acquire the Shares. Any holder of such options, warrants or other rights to acquire the Shares who wishes to accept the Offer must exercise or convert the options, warrants or other rights in order to obtain certificates representing the Shares that may be deposited in accordance with the terms of the Offer.

    The Offer is subject to certain conditions, including there being validly deposited under the Offer and not withdrawn as at the Expiry Time such number of Shares that constitutes, together with the Shares held by the Offeror and its affiliates, at least 662/3% of the Shares then outstanding (calculated on a fully-diluted basis), and at least a majority of the Shares then outstanding (calculated on a fully-diluted basis), the votes attached to which would be included in the minority approval of a second step business combination pursuant to Multilateral Instrument 61-101 –

  • Protection of Minority Security Holders in Special Transactions
  • . The Offer is not subject to any financing condition.

    This announcement is for information purposes only. The Offer (as the same may be varied or extended in accordance with applicable laws) is being made exclusively by means of, and subject to the terms and conditions set out in, the Offer Materials. The Offer Materials, as they may be amended from time to time, contain important information, including the terms and conditions of the Offer, that should be read carefully before any decision is made with respect to the Offer. Copies of the Offer Materials are available at www.sedar.com

    Equity Financial Trust Company has been retained by the Offeror to act as depositary for the Shares in connection with the Offer. Questions and requests for assistance may be directed to Equity Financial Trust Company at 1-866-393-4891 toll free in North America, or at 416-342-1091 outside of North America, or by email at TMXEInvestorServices@tmx.com


    About Nordgold

    Nordgold (LSE: NORD) is an internationally diversified low-cost gold producer established in 2007 and publicly traded on the London Stock Exchange. Nordgold has a proven track record of operational excellence and benefits from a significant international development pipeline. The Company is relentlessly focused on shareholder value, committed to running safe, efficient, profitable operations, which enable it to generate strong cashflows and in turn, continue to invest in its pipeline of new growth opportunities while generating returns for investors. In 2015, Nordgold produced 950 thousand ounces of gold with all-in sustaining costs of US$793 per ounce, maintaining its position at the lower end of the global cost curve.

    Nordgold operates 9 mines (5 in Russia, 2 in Burkina Faso and one each in Guinea and Kazakhstan). It has 2 active development projects (Bouly in Burkina Faso and Gross in Russia), 4 advanced exploration projects and a diverse portfolio of early-stage exploration projects and licences in Burkina Faso, Russia, French Guiana and Canada. Nordgold employs over 8,000 people.


    For further information, please contact:

    Nordgold
    Valentina Bogomolova
    Head of IR
    Tel: +7 495 644 4473
    valentina.bogomolov@nordgold.com
    Olga Ulyeva
    Head of Media Relations
    Tel: +7 495 644 4473
    olga.ulyeva@nordgold.com
    Powerscourt
    Ian Middleton
    Giles Read
    Tessa Berry
    Tel: +44 (0) 20 7250 1446
    Press release
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Irina Dormidontova

RECRUITMENT MANAGER
tel.+7 495 644 44 73

tel.+7 495 644 4473