$1.1 billion agreement reached between Centerra Gold and Thompson Creek Metals

Centerra Gold, the Canadian mining company, has agreed to buy the U.S-based Thompson Creek Metals in a deal worth $1.1billion in shares of cash.

The company, described as “unstainable” from Deutsche Bank analysts, will also pay off nearly $900 million of debt as it expands its operations in North America.

"Half of the value of all our assets will now be domiciled in Canada. I really think we have absolutely transformed the company in a very favourable way," Centerra Chief Executive Scott Perry said in an interview.

In November last year, Thompson Creek hired Moelis & Co and BMO Capital Markets to explore debt refinancing and restricting, as well as asset sales as the company’s debt exploded following the purchase of its biggest asset Mount Milligan in 2010.

The deal will see Centerra redeem all of Thompson Creek’s secured and unsecured notes plus accrued and unpaid interest of $889 million.

Centerra has said it will raise $130.76million through a bought deal, pay $460million from cash on hand at Thompson Creek and Centerra and raise $300million from a new debt facility.

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