XML 43 R11.htm IDEA: XBRL DOCUMENT
v3.24.0.1

ACQUISITIONS AND DIVESTITURES | 12 Months Ended
--- | ---
Dec. 31, 2023
Business Combination and Asset Acquisition [Abstract] |
ACQUISITIONS AND DIVESTITURES | ACQUISITIONS AND DIVESTITURES Acquisitions Hod Maden Project On May 8, 2023, the Company, through its wholly owned subsidiary Alacer Gold Corporation, closed on an agreement to acquire a 10% interest in, and operational control of, Artmin Madencilik Sanayi Ve Ticaret A.Ş (“Artmin”) which owns the Hod Maden gold-copper development project, located in northeastern Türkiye (the “Transaction”). Hod Maden was owned 70% by Lidya Madencilik Sanayi ve Ticaret A.Ş (“Lidya Mines”) and 30% by Horizon Copper Corp. (“Horizon”) prior to the closing of the Transaction. Upon closing of the Transaction, the Company made a $120.0 million cash payment to Lidya Mines to acquire a 10% interest in Artmin. The Company has the option to acquire an additional 30% interest in Artmin from Lidya Mines for $120.0 million in structured payments tied to the completion of project construction spending milestones. Additionally, the Company will make contingent payments to Lidya Mines including $30.0 million in milestone payments payable in accordance with an agreed upon schedule beginning at the start of construction and ending on the first anniversary of commercial production and $84.0 million payable upon the delineation of an additional 500,000 gold equivalent ounces of mineral reserves at the Hod Maden project in excess of the project’s current mineral reserves and mineral resources. The acquisition date fair value of the consideration paid is as follows (in thousands):
Cash paid to Lidya Mines for 10% interest | $ | 120,000 |
Contingent consideration tied to completion of operational milestones (1) |  | 24,300 |
Contingent consideration tied to delineation of new reserves (1) |  | 4,300 |
Total consideration | $ | 148,600 |
(1) The fair value of the two elements of contingent consideration are based on a discounted cash flow model. The contingent consideration is considered a Level 3 fair value measurement due to certain assumptions that are not based on observable market data (refer to Note 12 for more information). The significant assumptions include estimates of timing of completion of project milestones, probability of delineation of additional reserves, and discount rates. The contingent consideration is included within Other non-current liabilities on the Consolidated Balance Sheets. The Company determined that Artmin is a variable interest entity (“VIE”) for which it is the primary beneficiary and is consolidated under ASC 810 as the Company has the power to direct the significant activities and the right to receive benefits and obligation to absorb losses of Artmin. The assets of Artmin can only be used to settle the obligations of Artmin and not the obligations of the Company. The creditors of Artmin do not have recourse to the assets or general credit of the Company to satisfy its liabilities. The Company concluded that Artmin was not a business based on its assessment under ASC 805 and accounted for the acquisition as an initial consolidation of a VIE that is not a business under ASC 810. There was no gain or loss recognized upon initial consolidation of the VIE as the sum of the fair value of the consideration paid and non-controlling interest equaled the fair value of the net assets on the acquisition date. The Company incurred transaction costs of approximately $0.4 million in connection with the Transaction included in Other operating expenses, net in the Consolidated Statements of Operations. The Company retained a third-party appraiser to determine the fair value of the consideration paid, assets acquired, liabilities assumed, and non-controlling interest as of the acquisition date. The fair value estimates were based on income and market valuation methods. The following table summarizes the fair value of the assets acquired and liabilities assumed on the acquisition date (in thousands):
ASSETS |  |
Cash and cash equivalents | $ | 11 |
Trade and other receivables |  | 36 |
Inventories |  | 3 |
Prepaids and other current assets |  | 24 |
Mineral properties, plant and equipment, net (1) |  | 688,611 |
Other non-current assets |  | 1,690 |
Total assets acquired | $ | 690,375 |
LIABILITIES |  |
Accounts payable | $ | 315 |
Accrued liabilities and other |  | 643 |
Deferred income tax liabilities (2) |  | 135,939 |
Total liabilities assumed |  | 136,897 |
Net assets acquired and liabilities assumed |  | 553,478 |
Non-controlling interest |  | (404,878) |
| $ | 148,600 |
(1) The fair value of mineral properties, plant and equipment is based on applying the income and market valuation methods. The fair value of mineral properties determined using the income approach is $674.9 million. The significant assumptions include future metal prices, estimated quantities of mineral reserves and mineral resources, future capital and operating expenditures, and discount rates. (2) Deferred income tax liabilities represent the future tax expense associated with the differences between the fair value allocated to assets and liabilities and the historical carryover tax basis of these assets and liabilities. The assets acquired are included in the Corporate and other in Note 4. The non-controlling interest is representative of Lidya Mines and Horizon’s combined 90% interest and is inclusive of the 30% redeemable interest. As the redemption features are solely within the control of the Company, the redeemable non-controlling interest in Artmin is classified within permanent equity under ASC 480. Subsequent to the acquisition of the Hod Maden project, Horizon advanced Artmin $6.4 million during the year ended December 31, 2023 to help fund working capital. The loan is unsecured, bears interest at the credit default swap premium of Türkiye plus a fixed spread of 4.0% and matures on June 28, 2028. As of December 31, 2023, no repayments have been made on the loan. The liability is included in Other non-current liabilities in the Consolidated Balance Sheets. Acquisition of additional 30% ownership in Kartaltepe On November 17, 2022, the Company, through its wholly owned subsidiary Alacer Gold Madencilik A.S., completed the acquisition of an additional 30% ownership in Kartaltepe Madencilik Sanayi ve Ticaret Anonim Şirketi (“Kartaltepe”) from joint venture partner Lidya Mines (the “Transaction”) for total consideration of $150.0 million in cash. The Company previously owned 50% of Kartaltepe and accounted for its interest as an equity method investment with a reported amount of $4.2 million. Upon completion of the Transaction, the Company now owns 80% of Kartaltepe and is considered the primary beneficiary of the VIE and consolidates Kartaltepe under ASC 810. Kartaltepe is included in the Çöpler mine operating segment. The Transaction provides increased exposure for the Company to potential exploration success on the geologically prospective Kartaltepe licenses, including Çakmaktepe Extension, Çakmaktepe, and the Mavialtin Porphyry Belt. Additionally, the Transaction is expected to deliver material synergies through the remainder of Ҫӧpler’s mine life. The Company concluded that Kartaltepe was not a business based on its assessment under ASC 805 and accounted for the acquisition as an initial consolidation of a VIE that is not a business under ASC 810. As a result of the Transaction the Company recognized a gain of $81.9 million during the fourth quarter of 2022, included in Gain on acquisition of Kartaltepe in the Consolidated Statements of Operations. The gain represents the difference between: (i) the fair value of consideration paid, the fair value of the non-controlling interests, and the reported amount of the previously held interest and (ii) the total amount of the net assets recognized at fair value. At acquisition, the Company recognized all assets acquired and liabilities assumed at an aggregate fair value of $284.7 million, primarily consisting of $361.6 million in Mineral properties, plant and equipment, net 1 and $72.3 million in Deferred tax liabilities 2 on the Consolidated Balance Sheets. The fair value of Lidya Mines’ 20% interest of $48.6 million was recognized as Non-controlling interest on the Consolidated Balance Sheets. The Company retained a third-party appraiser to assist in determining the fair value of the assets acquired, liabilities assumed, and non-controlling interest as of the acquisition date. The fair value estimates were based on income and market valuation methods 1. Fair value is a market-based measurement and does not include entity-specific synergies. Acquisition of Taiga Gold Corp. On April 14, 2022, the Company completed the purchase of all the issued and outstanding common shares of Taiga Gold Corp. (“Taiga Gold”), which holds the exploration and evaluation stage resources in Saskatchewan, Canada in proximity to the Company’s Seabee mine and Fisher project. The transaction was accounted for as an asset acquisition for total consideration of $24.8 million. The total consideration was allocated to the assets acquired and liabilities assumed based on their estimated fair values on the acquisition date, which consisted primarily of cash and cash equivalents of $4.7 million, exploration and evaluation assets of $27.8 million, and a related deferred tax liability of $7.5 million. The assets are included in the Seabee mine operating segment. Divestitures Divestiture of San Luis On November 29, 2023, the Company entered into a definitive agreement with Highlander Silver Corp. (“Highlander Silver”) to sell its San Luis project in the Ancash department of central Peru, which is included in Corporate and other in N ote 4. Upon the expected closing of the Transaction in the first quarter of 2024, the Company will receive $5.0 million in cash and up to $37.5 million in contingent payments payable in cash, while retaining a 4% net smelter return royalty on the San Luis project. Assets of $0.8 million, included in Prepaid and other current assets, and liabilities of $0.7 million, included in Accrued liabilities and other, were classified as held for sale as of December 31, 2023. Divestiture of Pitarrilla On July 6, 2022, the Company completed the sale of the Pitarrilla project in Durango, Mexico to Endeavour Silver Corp. (“Endeavour Silver”). The consideration received included cash of $35.0 million, Endeavour Silver common shares with a fair value on the closing date of $25.6 million (8,577,380 shares at $2.99 per share), and a 1.25% net smelter returns royalty on the Pitarrilla property. A gain of $0.6 million was recognized, included in Other operating expenses, net in the Consolidated Statements of Operations, calculated as the difference between the consideration received and the carrying amount of the net assets sold. Divestiture of royalty assets On October 21, 2021, the Company completed the sale of a portfolio of royalty interests and deferred consideration (the “Royalty Portfolio”) to EMX Royalty Corporation (“EMX”) with a carrying value of $83.9 million. The total consideration received included cash, EMX common shares, and deferred consideration in the form of contingent payments of cash payable upon completion of certain project milestones related to one of the royalties totaling approximately $87.9 million. The fair value of the deferred consideration was estimated based on the present value of the projected future cash inflows using a discount rate of 12.5%. The projected future cash inflows are affected by assumptions related to the achievement of the development milestones. At June 30, 2021, following the negotiation of the Royalty Portfolio sale, the Company recorded an impairment loss of $22.3 million on the Royalty Portfolio, calculated based on the difference between the estimated fair value of the Royalty Portfolio and its carrying amount prior to the impairment. The Company recognized a gain on closing of the Royalty Portfolio sale to EMX of $2.1 million, net of $0.3 million of transaction costs, which has been recorded against the impairment loss. On December 22, 2023, the Company completed a secondary offering of common shares of EMX received in the Royalty Portfolio sale, classified under Marketable securities, in the form of 6,161,524 units (“Units”) for CAD $1.93 per Unit. Each Unit consists of one EMX common share and one right to purchase an additional EMX common share (an “Option”) that entitles the holder to acquire one EMX common share at a price of CAD $2.27 per share, expiring on December 31, 2024. The Company received cash proceeds of $8.7 million for the 6,161,524 Units and recognized a liability associated with the Options of $1.4 million, determined using the Black-Scholes option pricing model, included in Accrued liabilities and other. The Options are considered a Level 2 fair value measurement (refer to Note 11 for further information). A loss on the sale of the Units of $2.9 million was recognized and included in Other income (expense).

X
- References No definition available. + Details
Name: | us-gaap_BusinessCombinationAndAssetAcquisitionAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for business combinations, including leverage buyout transactions (as applicable), and divestitures. This may include a description of a business combination or divestiture (or series of individually immaterial business combinations or divestitures) completed during the period, including background, timing, and assets and liabilities recognized and reclassified or sold. This element does not include fixed asset sales and plant closings. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 805 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//805/tableOfContent Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 205 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//205-20/tableOfContent + Details
Name: | us-gaap_MergersAcquisitionsAndDispositionsDisclosuresTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration