Electrum Resources (LON:ECR, OTC:MTGDY) expects the value of its stake in THEMAC to grow substantially in the future, now that THEMAC agreed a fundraising to take full control of the Copper Flat copper-molybdenum-gold-silver project.
In March, under its previous incarnation as Mercator Gold, Electrum agreed a deal with THEMAC to sell Copper Flat in a share-based deal.
Yesterday, THEMAC confirmed that it has raised C$10.2 million from one of its major shareholders Marley Holdings.
The funding will enable THEMAC to complete its purchase of Electrum’s exclusive option over the entire Copper Flat project.
“Completion of the transaction will give Electrum a significant shareholding in THEMAC,” Electrum managing director Patrick Harford said.
“As a result of the Financing [THEMAC will] be well funded to continue advancing the Copper Flat project through feasibility and permitting with the objective of returning the project to production as soon as possible.”
“Accordingly, we anticipate substantial future growth in the value of our interest in THEMAC.”
On completion Electrum’s total shareholding in THEMAC will be 14.5 million common shares - equivalent to approximately 20% of THEMAC’s equity.
Electrum will also hold a total of 14.5 million common share purchase warrants of THEMAC.