Pembridge Resources PLC (LON:PERE) has signed a definitive share purchase agreement with Capstone Mining Corp (TSE:CS) for the acquisition of the Minto copper, gold and silver mine in the Yukon, Canada.
The consideration comprises up to US$20mln in total payments due to Capstone payable out of future cash flows and realisations from Minto, and based on certain hurdles linked to production levels at Minto as well as future copper prices.
WATCH: Pembridge Resources signs deal for acquisition of Minto mine in Canada
In addition, financing of US$10mln to fund the recommencement of operations has been secured from Copper Holdings, a New York-based private equity group and Cedro Holdings I, a New York based asset manager.
Production from Minto is expected to recommence in the fourth quarter of 2019. The company has also raised £400,000 of working capital at 16p per share.
"We have said all along that the acquisition of Minto represents a transformational opportunity for Pembridge and its shareholders which is why we continued to pursue the Transaction despite last year's downturn in commodity markets and the challenging environment for raising capital,” said David Linsley, chief executive of Pembridge.
“While market conditions impacted closing of the transaction, we were able to use this time to achieve a deal and financing package which we expect to be value accretive for Pembridge shareholders.”
