Canada-based mineral exploration and development company Treasury Metals has agreed to merge with Blackwolf Copper and Gold, which owns the Niblack project in Alaska.
The merger is expected to advance the Goliath Gold Complex (GGC) project in Ontario, towards production with a strengthened leadership, balance sheet and cash balance of C$10m.
GGC project, together with the Niblack Copper-Gold project and other exploration properties represent promising upside potential for the combined company.
Under the agreed terms, Blackwolf shareholders are eligible to receive 0.607 of a Treasury share, in exchange for each Blackwolf share held.
Upon completion of the transaction, existing Treasury shareholders will have around 68.3% ownership and Blackwolf shareholders around 31.7% of the combined company.
As part of the proposed acquisition, Treasury’s president and CEO Jeremy Wyeth is planned to be appointed as CEO of the combined company.
Also, Blackwolf’s CEO Morgan Lekstrom will be appointed as the president and its largest shareholder Frank Giustra will be the largest shareholder of the combined company.
Lekstrom said: “Treasury has done an incredible job of advancing the GGC Project through the start of engineering and permitting, and we are optimistic that it can evolve into a major Canadian gold camp.
“The combined financial strength and asset portfolio gives us the capital to move into a new stage of growth in a rising gold market.
Giustra said: “This is a strong transaction for Blackwolf and Treasury shareholders that puts the company on the path of a buy-and-build strategy that I have implemented many times.
“We see the GGC Project as buildable and expandable on a district scale. I look forward to continuing to be a supportive shareholder and am excited to join the team as a Strategic Advisor.”
Treasury, to enhance financial flexibility, has revised its agreement with Sprott Resources Streaming and Royalty, deferring quarterly minimum payments for the next four quarters.
In exchange, the Canadian mining company’s quarterly minimum payment will be increased from $500,000 to $675,000, and the deadline for the last payment will be moved forward.
The GGC project represents a 65km trend that lies within a 330km2 land package and hosts three distinct projects within the Wabigoon greenstone belt.
The main Goliath project comprises an open-pit and underground gold mine and related milling facility located 20km east of Dryden, Ontario.
