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Austral Gold to invest $9.3 million in Canadian Goldrock Mines Corp

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Austral Gold (ASX: AGD) has entered into a subscription agreement with Goldrock Mines Corp (TSX-V: GRM) whereby Austral will subscribe for up to 11,560,000 new shares at C$0.80 per share for a total consideration of C$9.3 million.

Goldrock Mines currently has a market cap. of around C$29 million.

Austral will also be issued 1 new warrant for every new share subscribed, with a strike price of $0.80 for a period of 60 months from closing.

Upon completion of the subscription agreement anticipated by 31 October 2013, Austral Gold will hold up to 15% of Goldrock and will have the right to appoint one non-executive director to Goldrock’s Board and one member to Goldrock’s technical committee.

In addition, the subscription agreement grants pre-emptive or anti-dilution rights, entitling Austral to participate in any future equity offerings to maintain its pro-rata shareholding.

Goldrock holds 100% of the Lindero gold project in northwest Argentina, with proven reserves of 641,000 gold ounces and probable reserves of 878,000 gold ounces at 0.66 to 0.82 grams per tonne gold.

 

Proactive Investors Australia is the market leader in producing news, articles and research reports on ASX “Small and Mid-cap” stocks with distribution in Australia, UK, North America and Hong Kong / China.

Quick facts: Austral Gold Limited

Price: 0.23 AUD

ASX:AGD
Market: ASX
Market Cap: $130.2 m
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