Gold Resource Corporation (NYSE American: GORO) said Monday it has reached a definitive agreement to be acquired by Goldgroup Mining Inc. (TSX-V: GGA; OTC: GGAZF) in an all-stock transaction. The announcement triggered a 17.4% advance in Gold Resource shares in premarket trading.
Under the terms laid out by the companies, each Gold Resource share will be exchanged for 1.4476 common shares of Goldgroup. That ratio will be adjusted to 0.3619 Goldgroup shares for each Gold Resource share after Goldgroup carries out a planned four-for-one share consolidation before the deal closes.
The exchange rate values Gold Resource at $2.25 per share, which the companies said represents a 39% premium to Gold Resources closing price on January 23, 2026. On a fully-diluted in-the-money basis, the transaction places a value on Gold Resource at about $372 million.
Following completion of the merger, Gold Resource stockholders are expected to own approximately 40% of the combined company. Management and governance arrangements set out in the agreement call for a combined board that includes three directors appointed by Goldgroup and two by Gold Resource. Gold Resources executive management team is anticipated to assume officer roles within the combined entity.
The companies emphasized that the combined business will operate a multi-mine producing platform. Gold Resource brings the producing Don David Gold Mine and the PEA-stage Back Forty Project, while Goldgroup contributes its producing Cerro Prieto Mine and the recently acquired San Francisco Mine.
"Having successfully executed a turnaround at the Don David Gold Mine, the Company is positioned to expand production through the proposed transaction," said Allen Palmiere, Gold Resources President and CEO. "The addition of the San Francisco Mine and the Cerro Prieto mine is expected to increase gold exposure and materially enhance cash generation through higher overall output."
The boards of both companies unanimously approved the transaction. The companies said the deal is expected to close in the second quarter of 2026, subject to customary shareholder approvals and receipt of regulatory clearances.
Cormark Securities is acting as financial advisor to Gold Resource for the transaction.
Summary
This all-stock acquisition will combine producing assets and development-stage projects across both companies, alter the ownership mix of the combined company so that former Gold Resource shareholders hold roughly 40%, and values Gold Resource at a per-share premium versus its recent closing price. The transaction remains conditional on approvals from shareholders and regulators and a planned share consolidation by Goldgroup prior to closing.
Sectors impacted
- Mining and metals - consolidation of gold-producing assets and development projects
- Equities - share price reaction for Gold Resource in premarket trading