Luminex up 26% on Adventus takeover news
Adventus Mining Corp. [TSXV-ADZN, OTCQX-ADVZF] has struck a deal to acquire all of the issued and outstanding shares of Luminex Resources Corp. [TSXV-LR, OTCQX-LUMIF] via a share exchange deal.
Under the terms of the plan of arrangement deal, which was announced after the close of trading on November 21, 2023, holders of Luminex shares will receive 0.67 Adventus shares for each Luminex share held.
A concurrent financing for approximately $17.1 million priced at 29 cents, with participation by financier Ross Beaty and Wheaton Precious Metals Corp. (TSX-WPM, NYSE-WPM) is expected to be completed as part of the transaction.
Luminex shares jumped 26.5% or $0.045 to 21.5 cents on the news. The shares trade in a 52-week range of 42 cents and 16 cents. Adventus eased 4.0% or $0.015 to 36 cents.
The transaction, expected to close in January, 2024, is designed to create a combined company that intends to lead the advancement of the El Domo-Curipamba copper-gold project towards production and consolidate a large and prospective gold-copper development and exploration portfolio in Ecuador covering over 135,000 hectares, including the preliminary economic-stage Condor gold-copper project.
The 98.7%-owned Condor project is adjacent to Lundin Gold Inc’s [TSX-LUG] Fruta del Norte and Tongling/China Rail’s Mirador project.
The combined company brings together the support of members of Beaty’s Lumina Group, local Ecuadorian investors and strategic and equity investors that include Altius Minerals Corp. [TSX-ALS, OTCQX-ATUSF] and Wheaton Precious Metals.
Altius is currently Adventus’s largest shareholder. Beaty is expected to hold 13% of the combined company after the transaction and concurrent financing is complete.
The transaction is subject to the approval at a special meeting of Luminex shareholders by 66 and 2/3% of the votes cast by Luminex shareholders, 66 and 2/3% of the votes cast by Luminex shareholders and option holders, voting together as a single class, and if required, a simple majority of votes cast by Luminex shareholders, excluding the votes cast by certain persons as required by MI 61-101.
Back in January, 2022 Adventus and Salazar Resources Ltd. [TSXV-SLR] secured US$235.5 million for development of the Curipamba Copper Projectvia financing deals with Wheaton Precious Metals and Trafigura Pte Ltd.
Curipamba, held 75% and Adventus and 25% by Salazar, is forecast to be a high-margin mine in the lowest half of the copper cost curve with a 10-year open-pit mine life and the potential to transition into an underground mine subsequent to the open pit. Adventus and Salazar said the financing deal validates a detailed feasibility study for the project, which was completed in late 2021, and which envisages a capital cost of US$248 million.
Adventus anticipates construction activities to begin as early as late 2022, with commissioning of mine operations occurring as early as 2024. Attributable production is expected to average 17,000 ounces of gold and 551,000 ounces of silver annually for the first five years of production.
The US$235 million secured included a US$180.5 million financial commitment from Wheaton and a US$55 million from Trafigura, money that is available via agreements between Alliance Metals International, a unit of the mine holders’ joint venture company Salazar Holdings Ltd., Wheaton after Trafigura.