Candelaria Mining Corp (CVE:CAND) (OTCPINK:CDELF) has shored up its senior management team as talks continue with Empire Metals Ltd to acquire its Georgian asset.
In October last year, the exploration firm inked a deal to acquire Empire’s subsidiary GMC Investments Ltd, which holds a 50% interest in the Bolnisi gold and copper project in the Republic of Georgia. Bolnisi spans an 860-square-kilometre area in the prolific Tethyan belt, which hosts numerous high-grade deposits and producing mines. The deal is subject to a right-of-first-refusal clause in favour of Empire’s Georgian partner Caucasian Mining Group Ltd (CMG).
In a statement Monday, Candelaria said that while CMG have indicated an interest in exercising their right, they have yet to provide Empire with an acceptance of the offer.
READ: Candelaria Mining welcomes new CEO Mike Struthers as it inks deal for interest in prospective gold project in Georgia
Under the terms of the deal, Candelaria will pay C$2 million worth of shares priced at C$0.50 to Empire. The company will pay an additional C$1 million in shares once a reserves report on the Kvemo Bolnisi East project is approved by the State Reserves Committee in Georgia, and an additional C$2 million in shares once there is a NI 43-101 technical report on the Dambludi project or another project that is not Kvemo Bolnisi East. Both payments will be calculated in shares based on the previous 10-day average closing price.
In addition, Candelaria will pay another C$2 million in shares upon the completion of a feasibility study and final investment decision on Kvemo Bolnisi East.
Candelaria said Empire is confident it will receive the full consideration of nearly C$7 million in shares offered by Candelaria, and the companies continue to seek a resolution to the situation.
While the deal remains on the table, Vancouver-based Candelaria said it had appointed Mike Struthers to the CEO position as well as its board of directors. In addition, former Lundin executive Neil O’Brien will take a seat on the board.
Building portfolio
“Although we continue to discuss with Empire the potential acquisition of their assets in Georgia, we are very pleased and looking forward to having Mr. Struthers and Dr. O’Brien join our team,” Candelaria president Ramon Perez told shareholders.
“They bring very valuable experience and expertise in exploration and development of precious metals assets on a global basis to our company. We look forward to drawing upon this experience as we continue to build a portfolio of mining projects and step up the development and exploration activities even further.”
Candelaria has a portfolio of assets in Mexico. The Bolnisi project will give Candelaria exposure to an emerging gold-copper district in the Republic of Georgia.
Contact Angela at angela@proactiveinvestors.com
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