Benefits of the Zijin Transaction

In consultation with its independent financial and legal advisors, the Board has determined that the Arrangement with Zijin is in the best interests of Guyana Goldfields and is fair to Shareholders.

Shareholders will benefit from:

  • The arrangement being superior to the Silvercorp Arrangement: The board of directors, after consultation with its financial and legal advisors, determined that the arrangement is superior to the arrangement (the “Silvercorp Arrangement”) with Silvercorp Metals Inc. which the company terminated as of June 11, 2020 to enter into the transaction with Zijin Mining.
  • A significant premium: The consideration of C$1.85 per Guyana Goldfields share represents a (i) 427% premium to the volume weighted average price of the company shares on the TSX for the 20 trading days ended April 24, 2020 (the last trading day prior to the date that the company announced that it had entered into an arrangement agreement with Silvercorp,; and (ii) 35% premium to the implied value of the consideration offered pursuant to the Silvercorp Arrangement (based on the closing price of the common shares of Silvercorp on the TSX as of June 3, 2020, the date that the company announced that Zijin’s proposal constituted a Superior Proposal (as defined under the Silvercorp Arrangement agreement).
  • Certainty of value: The cash consideration payable to shareholders under the Zijin arrangement provides for certainty of value and immediate liquidity.

Additional details with respect to the potential benefits and risks of the Zijin transaction are described in the circular.