JOHANNESBURG (miningweekly.com) – Silver miner Alcyone Resources has signed a A$25-million financing deal with global hedge fund Platinum Partners, and has also agreed to a A$5-million buy of the Red Arrow mine, in the US.

Alcyone said on Wednesday that the financing deal would fund the company’s growth by way of value accretive acquisition opportunities in the precious metals space.

With the completion of its crusher upgrade at the Texas silver mine, in Queensland, the company would undertake a plan to aggressively build its portfolio of precious metals through acquisition and consolidation of high-grade and undervalued assets.

Alcyone has now entered into an agreement with Platinum Partners to acquire the Red Arrow gold and silver mine for A$5-million. The acquisition would be funded by way of a A$1-million equity issue with Platinum and a A$40-million convertible loan note to be drawn on release and the grant of security changes.

The equity issue would consist of some 200-million shares, at a price of 5c each.

“With our silver mine in Queensland now running at a 1.1-million tonne a year capacity, our plans going forward with Platinum Partners are to build a portfolio of high-value precious metals mining interest,” said Alcyone nonexecutive chair Paul D’Sylva.

“Through the acquisition of the Red Arrow mine, in a renowned mining area of Colorado, we are well placed to add a second world class precious metals project to our portfolio, which has excellent development potential, with high gold and silver concentrations and nearby access to a maintained public road system.”

The Red Arrow project consists of 370 acres of patented mining claims and 160 acres of unpatented mining claims. The mine has historically produced commercial grade gold and silver ore, and has a high concentration of gold and silver, along with existing mining infrastructure.

D’Sylva said that with the A$25-million funding in place, Alcyone was now in a position to step up the process of reviewing a number of investment opportunities which would further expand and diversify the business.