Hayden-based Timberline Resources Corp., a mining company with gold and copper exploration projects in Nevada, has entered an agreement to be acquired by McEwen Mining Inc.

The agreement allows the Toronto-based company to acquire all of the issued and outstanding shares of Timberline.

According to a McEwen press release, the transaction is valued at $18.8 million.

Patrick Highsmith, president and CEO of Timberline, says it hasn't been determined yet whether Timberline will have a continued presence in  Kootenai County following the closing of the transaction.

Regardless, the company's presence there now is minimal. Timberline currently has four employees, he says. At one point in the company’s history, Timberline had projects in Idaho and Montana.

If shareholders approve the transaction, it's expected to be completed during the third quarter of this year, making Timberline a wholly-owned subsidiary of McEwen. The Timberline board of directors has recommended unanimously that shareholders approve the transaction, according to the release.

Under the agreement, Timberline shareholders will have the right to receive a 0.01 share of McEwen’s common stock for each share of Timberline’s common stock.

That exchange rate represents a value of slightly over 10 cents per Timberline share, based on the 20-day volume-weighted average trading price of McEwen’s shares on the New York Stock Exchange at the close on April 15, according to the release. This represents a 132% premium for Timberline’s 20-day volume-weighted average price on the OTCQB, which is the middle tier of the over-the-counter markets for U.S. stocks.

The transaction will add to McEwen’s existing portfolio of projects in Nevada, the release states.

“The (transaction), at an attractive premium to Timberline’s current trading price, provides our shareholders with continued exposure to Timberline’s assets as part of a more diverse, growth-oriented platform,” says Highsmith in a Timberline press release.