Gold producer and explorer St Barbara (ASX:SBM) has through its wholly owned subsidiary Nord Pacific Ltd., is looking to buy Canadian Atlantic Gold Corporation.
Atlantic is low cost gold producer which owns and operates Moose River Consolidated in Nova Scotia, Canada.
Moose River has one producing open-pit (Touquoy) and three others in development (Beaver Dam, Fifteen Mile Stream and Cochrane Hill).
St Barbara will acquire 100 per cent of all outstanding Atlantic shares.
The company's broker Deutsche Bank launched the $490 million non-renounceable entitlement offer this morning, offering shareholders one new share for every 3.1 they already owned.
New shares were available at $2.89 each, which was a 13 per cent discount to the last close according to a term sheet in front of fund managers. It was also a 10.1 per cent discount to the theoretical ex-rights price.
Shares in St Barbara (ASX:SBM) are currently in a trading halt, they last traded at $3.32 .