Proactive Investors - Run By Investors For Investors

Red 5 closes two landmark gold acquisitions in the Eastern Goldfields

The company is set to join the ranks of Australian gold producers.
gold bars
Red 5 will have a cash-flow base at Darlot

Red 5 Limited (ASX:RED) has completed the acquisitions of the operating Darlot Gold Mine and the advanced King of the Hills Gold Project in the Eastern Goldfields of Western Australia.

Darlot was acquired from a subsidiary of South Africa-based gold producer Gold Fields (JSE:GFI) after paying $6.5 million in cash and 130 million Red 5 shares.

The Darlot Gold Mine has been acquired by Red 5 as a going concern and mining and processing operations will continue through the ownership transition.

The King of the Hills project was acquired from gold producer Saracen Mineral Holdings (ASX:SAR) by paying $6.5 million in cash and 90 million Red 5 shares.

A further deferred consideration (in cash or shares) of $5 million is payable to Gold Fields within the next 24 months and $4.5 million to Saracen within the next 12 months.

The acquisition makes Gold Fields and Saracen two substantial shareholders in Red 5 with each party holding a relevant interest of 19.92% and 10.54% respectively.

Red 5 now has a production and cash-flow base at Darlot and a significant opportunity at the King of the Hills, where underground mining is targeted to commence next month.

The acquisition was completed after Red 5 raised circa $12.7 million via a rights issue.

Importantly, this opens a significant new chapter for the company as an Australian gold producer listed on the ASX.

The company’s shares closed circa 11% higher on Monday, at $0.049.

View full RED profile View Profile

Red 5 Ltd Timeline

December 31 2012

Related Articles

Etango aerial view
November 21 2018
The uranium developer is positioning itself to benefit from the early stages of a recovery in the uranium sector.
August 07 2018
Production at Hellyer is expected to begin in the fourth quarter
periodic table
September 10 2018
W Resources should be in production from La Parrilla next year

© Proactive Investors 2018

Proactive Investors Australia PTY LTD ACN:132787654 ABN:19132787654.

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use