Alio Gold Inc. (TSX:ALO) (NYSE AMERICAN: ALO) announces that it has entered into a definitive share purchase agreement to sell its wholly-owned subsidiary, Molimentales del Noroeste S.A. de C.V. which owns a 100% interest in the San Francisco mine and the surrounding mineral concessions to Magna Gold Corp. (TSX-V: MGR) (OTCQB: MGLQF). Under the terms of the Agreement, Alio Gold will receive 9,740,000 shares of Magna upon closing of the Transaction, representing approximately 19.9% of the issued and outstanding shares of Magna, and an additional $5 million in cash within twelve months of closing of the Transaction. Alio Gold and Magna expect the Transaction to close in March 2020.
“The sale of San Francisco is a win-win for Alio Gold and Magna,” said Mark Backens, President and CEO of Alio Gold. “Arturo Bonillas and his team at Magna have a lengthy history and extensive knowledge of the Mine, and under his stewardship we are confident this Transaction will be very beneficial to the employees, contractors, suppliers and local communities that support the Mine as plans are implemented to unlock value from the property. The Transaction transfers all current assets and liabilities associated with the property and allows Alio Gold to focus time and resources on more value enhancing opportunities at the Florida Canyon Mine, our core asset.”
About Alio Gold
Alio Gold is a gold mining company. We are focused on the safe and profitable production of gold from our cornerstone asset, the 100% owned Florida Canyon Mine in Nevada, USA. The Company also owns the development stage Ana Paula Project in Guerrero, Mexico.
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We acknowledge the [financial] support of the Government of Canada.