TLDR
- Eldorado drops nearly 10% after announcing $3.8B Foran acquisition deal
- Gold price crash adds pressure as Eldorado expands copper exposure
- Merger ties Eldorado to two major mine launches at the same time
- Combined company targets $1.5B free cash flow by 2027
- Investors worry about timing as metals markets stay volatile
Eldorado Gold (EGO) moved sharply lower after the company announced a $3.8 billion agreement to acquire Foran Mining. The stock dropped to $38.80 and fell 9.60% during a steady intraday decline. The move signaled immediate market concern as the company expanded its gold and copper exposure.
Eldorado Gold Corporation, EGO
Eldorado confirmed that the agreement will provide Foran shareholders with 0.1128 Eldorado shares plus a small cash payment. The structure positioned Eldorado to hold 76% of the combined company. Foran shareholders will receive the remaining stake once the transaction closes.
The merger aims to create a larger metals producer with a multi-jurisdictional pipeline. Eldorado stated that both companies hold major projects nearing completion. The combined entity expects long-life output from assets in Greece and Saskatchewan.
Deal Arrives During Severe Metal Price Volatility
The agreement emerged during a sharp downturn in the precious-metals market. Gold dropped about 15% within a week after reaching record highs in January. This slide added pressure on sector-linked equities and shaped the reaction to the announcement.
Market conditions shifted quickly as gold traded near $4,721 per ounce on Monday. Copper prices also eased after recent strength across global commodities. This environment reduced appetite for large expansion decisions across the mining sector.
This backdrop created tension because Eldorado is advancing the $1-billion Skouries project. The mine targets strong gold and copper production once operations begin mid-year. Foran is also completing the McIlvenna Bay project, which reports 85% construction progress.
Execution Pressure Rises as Two Projects Advance
The merger increases operational demands as Eldorado prepares to manage two major project ramps at once. The company highlighted its ability to handle multiple development programs simultaneously. It pointed to expected production strength across both mines starting in 2027.
Foran’s asset is designed to deliver copper, gold, silver and zinc once commercial output begins. The project supports broader exposure to critical minerals and strengthens future revenue diversity. Eldorado expects this addition to enhance cash flow once markets stabilize.
Both companies confirmed that financing for their projects remains in place. They also projected a combined free cash flow profile of $1.5 billion in 2027. The firms anticipate closing the transaction in April pending shareholder and regulatory approval.
Broader Industry Context Supports Long-Term Growth
The metals sector continues to balance short-term price weakness with strong long-term demand expectations. Electrification trends have increased global interest in copper expansion. Gold maintains a strategic role across financial markets despite recent volatility.
Eldorado said the combined company will remain weighted toward gold production. Copper will still play a meaningful role as future demand strengthens. The final structure aims to position the group for a stronger commodity cycle.
The merger follows months of corporate review as Eldorado searched for strategic expansion paths. The company identified Foran as a suitable partner based on asset quality and timeline alignment. The transaction outlines a forward plan centered on near-term growth and long-term output stability.
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