11:39 AM EDT, 03/19/2018 (MT Newswires) -- Hecla Mining Company (HL) -- a low-cost U.S. silver producer -- on Monday dropped 10.9% in NYSE trade after saying that it will buy all the outstanding shares of Klondex (KDX.TO), a high-grade Nevada underground gold producer with its Fire Creek, Midas and Hollister mines, through a plan of arrangement. According to a statement, Klondex will spin out its Canadian assets to its existing shareholders.

Klondex shares on the other hand have more soared more than 60% since market open today.

Under the terms of the transaction, Hecla will pay US$462 million with a mix of cash and shares of Hecla common stock and the newly formed company, Klondex Canada. Klondex's shareholders will receive US$2.47 per share in cash or shares of Hecla, which represents a 59% premium to Klondex's 30-day volume-weighted average price, as at March 16, 2018 on the NYSE American.

Price: 3.44, Change: -0.41, Percent Change: -10.70