PERTH (miningweekly.com) – ASX-listed MOD Resources has agreed to divest of its Sams Creek gold project, in New Zealand, to Condamine Resources for A$3.8-million.
Condamine is hoping to complete an initial public offering (IPO) shortly and to list from the ASX, before the end of the calendar year.
In exchange for its Sams Creek project, MOD will receive A$1.75-million in cash and 10.25-million Condamine shares, at an issue price of 20c a share. Following the company’s listing, MOD’s interest in Condamine could potentially be 15%.
Furthermore, MOD shareholders could potentially be given a priority offer for Condamine shares as part of that company’s IPO.
MOD MD Julian Hanna said on Monday that the sale of the Sams Creek project represented a good outcome for shareholders, and should enable the company to put its energy into its Botswana assets.
“The agreement provides the opportunity to monetise the company’s noncore gold assets by divesting them to a new, dedicated New Zealand-focused gold exploration company.
“This transaction has the additional benefit of preserving MOD shareholders’ exposure to an excellent gold project, which has significant upside.”
The Sams Creek project is currently estimated to host a 20.5-million-tonne resource, grading 1.54 g/t gold, including an indicated resource of 10.1-million tonnes at 1.77 g/t gold.
MOD is exploring in the Kalahari copper belt, in Botswana, and has a joint venture with Aim Metal Tiger.