Austral Gold is a growing gold and silver producer which has built a portfolio of assets in Chile, Argentina and the U.S. The company’s flagship asset is the Guanaco/Amancaya gold and silver mine complex in Chile. Other assets in its portfolio include the 100%-owned Casposo Mine in Argentina, the 26%-owned Rawhide Mine in the U.S., and exploration projects in both Argentina and Chile.
Production at Guanaco/Amancaya was 16,160 gold equivalent ounces during Q3 2020, putting the mine on track to achieve a previously announced target of 55,000-60,000 gold equivalent ounces in 2020, the company has said.
“We are very pleased to have entered into the definitive arrangement with Revelo,” said Austral CEO Stabro Kasavena. “The addition of Revelo’s assets to our portfolio, including three projects located close to our pre-existing Guanaco/Amancaya mining complex is strategic, and provides us with a leading role in the Paleocene-Eocene Belt in Chile,” he said. “In addition, we believe this prolific mineralized belt is under explored for precious metals.”
Under an agreement between the companies, holders of Revelo shares will be entitled to receive 0.9184 ordinary shares of Austral, and $0.03045715 in cash, representing an implied price of $0.305977 per Revelo share, based on the closing price of Austral shares on the TSX Venture Exchange, of $0.30 on September 1, 2020, the day before the transaction was announced.
Austal is proposing to fund the aggregate cash consideration of $1.176 million using its cash reserves. Completion of the transaction requires the approval of at least two thirds of the votes cast by Revelo shareholders at a special meeting that is expected to take place on January, 2021.
Revelo shareholders representing approximately 51.6% of the issued and outstanding Revelo shares have agreed to back the arrangement.
“The signing of the definitive agreement with Austral represents the next step in what is an incredibly attractive deal for Revelo’s shareholders,” said Revelo Chairman Michael Winn.
Revelo holds interests in a portfolio of gold-silver and copper projects in northern Chile. They include eight properties that are in the process of being sold to West Pacific Ventures.