Ausmex Mining Group Ltd (ASX:AMG) is divesting its non-core Gilded Rose project in Cloncurry, Queensland for a total consideration of $4 million.
The project is being acquired by PepinNini Lithium Ltd (ASX:PNN) for a combination of cash and shares.
Funding to progress Mt Freda Complex
The total cash consideration includes $3 million with $1.5 million to be received by completion, including the $100,000 non-refundable option fee (with $20,000 payable immediately and $80,000 on completion of due diligence), together with an additional $1 million in PepinNini shares on completion.
The cash payment combined with the current working capital in hand will provide Ausmex with adequate funding to progress the Mt Freda Complex in Cloncurry, whilst simultaneously progressing the Golden Mile Mining Lease application, as well as additional drilling program at the Burra Copper and Gold project in South Australia.
Gold production targeted in September
Ausmex is targeting September 2020 gold production from the Mt Freda Complex.
The company has an agreement with a subsidiary of Washington H. Soul Pattinson and Co. Ltd (ASX:SOL) where all ore from the Golden Mile Joint Venture must be processed at the 650,000 tonnes per annum Great Australian Mine gold CIP plant in Cloncurry.
Next steps
The Gilded Rose divestment is subject to a number of conditions, including completion of satisfactory due diligence, approval by PepinNini’s shareholders (including for a proposed capital raising by PepinNini) and negotiation and execution of formal transaction documents.
