Mining
Tuesday, September 17th, 2024 3:50 pm EDT
Key Points
- Acquisition Agreement: Denarius Metals Corp. has signed a binding letter of intent to acquire 100% of Europa Metals Ltd.’s Spanish subsidiary, Europa Metals Iberia SL, which owns the Toral zinc-lead-silver project in northern Spain. The deal is expected to close by October 31, 2024.
- Project and Strategic Goals: The acquisition aligns with Denarius Metals’ strategy to support climate transition in the EU by producing low-carbon metals. The company aims to integrate the Toral project with its Aguablanca project and enhance its liquidity and flexibility for project development.
- Transaction Details and Conditions: The purchase price includes the loan amount already advanced and an additional $3.5 million, paid through issuing seven million common shares at 50 cents per share. The transaction is contingent on board, shareholder, and regulatory approvals, and will terminate the previous option and loan agreements.
Denarius Metals Corp. has signed a binding letter of intent (LOI) with Europa Metals Ltd. whereby the company will acquire 100 per cent of the issued and outstanding shares of Europa Metals Iberia SL (EMI), a wholly owned Spanish subsidiary of Europa which holds the Toral zinc-lead-silver (Zn-Pb-Ag) project in the Leon province, northern Spain. The closing of the transaction is expected to occur no later than Oct. 31, 2024.
Serafino Iacono, executive chairman and chief executive officer, commented: “The transaction is in keeping with our vision of producing low-carbon metals within the European Union to support climate transition and the EU’s bid to secure the resources needed for technologies such as renewable energy and battery power. Our work to date provides us with confidence in the potential for the Toral project to become a long-life underground mining operation which may supply material to the 5,000 tonnes per day processing plant at our Aguablanca project in Spain. Completing the acquisition of 100 per cent of the Toral project through the transaction strengthens our liquidity and improves our flexibility to manage the development schedule for our projects in Spain without having to meet the specific obligations mandated under the option agreement. Later this year, we will commence work on the preparation of an updated mineral resource estimate followed by a preliminary economic assessment for the Toral project.”
The company and Europa entered into a definitive option agreement dated Nov. 22, 2022, pursuant to which the company was granted options to acquire, in two stages, up to an 80-per-cent ownership interest in EMI. In conjunction with its commitments under the first option, the company has been carrying out an exploration program at the Toral project since the beginning of 2023 and, to date, the company has financed approximately $3.1-million (U.S.) through a loan agreement dated Nov. 22, 2022, between the company, Europa and EMI. In 2023, the company carried out a drilling campaign which comprised approximately 6,200 metres of validation and infill drilling in nine holes completed within the Toral project’s known indicated mineral resource area. All holes completed were successful in intersecting mineralization adjacent to selected, previously reported high-grade intersections within the Toral project’s indicated resource block. In addition, the formal application for a mining licence was also filed with the local authority in 2023 as required under the option agreement.
The purchase price for the company’s acquisition of a 100-per-cent equity interest in EMI will be the funds advanced under the loan agreement and an additional $3.5-million to be settled through the issuance of seven million common shares of the company at a price of 50 cents per share. The common shares to be issued in the transaction will be subject to a hold period ending on the date that is four months plus one day following the issuance date. As a condition to closing, Europa will capitalize all amounts payable from EMI to Europa prior to closing such that on closing, EMI shall not owe any funds or have any outstanding liabilities to Europa. The option agreement and the loan agreement will also be terminated on closing.
The transaction is subject to each of the company, Europa and EMI receiving all necessary board, shareholder and regulatory approvals including, but not limited to, approval by Cboe Canada Inc.
About Denarius Metals Corp.
Denarius Metals is a Canadian junior company engaged in the acquisition, exploration, development and eventual operation of polymetallic mining projects in high-grade districts.
We seek Safe Harbor.
