Photo by: Reuters
TORONTO (miningweekly.com) – TSX-listed Tyhee Gold on Friday announced that it had struck a deal with RMB Australia and TSX-V-listed Sutter Gold Mining to acquire the shares of Sutter currently held by RMB and its affiliates.
Vancouver-based Tyhee said subject to certain conditions, it would also acquire all of the Sutter shares issued to RMB by Sutter under a proposed conversion of the $8-million of RMB’s debt exposure to Sutter, and about $17-million of RBM’s debt exposure to Sutter.
Tyhee would pay RMB C$0.02 a Sutter share for a total of C$1.16-million. Upon completion of the transaction, Tyhee would hold about 73% of Sutter’s issued and outstanding shares, on a nonfully diluted basis.
Sutter currently holds several precious metals properties in California, including the permitted Lincoln underground mine near Sutter Creek, as well as a new permitted processing facility near the entrance to the Lincoln mine.
In March, the project was placed on care and maintenance while certain production issues were being evaluated and the company reduced costs owing to capital constraints.
RMB Australia is a unit of FirstRand, a South African-based financial services group. RMB currently holds about $40-million in debt from Sutter and about 58.2-million (47%) of Sutter’s 123-million outstanding shares.
After the transaction closes, Brian Briggs will continue as president and CEO of Tyhee. Tyhee’s core assets will include majority ownership of Sutter, which holds 100% of the Lincoln mine and mill, and the Keystone gold deposit, all in California, as well as a significant growth asset, the larger but longer term Yellowknife gold project, in Canada's Northwest Territories.