GoGold Resources Inc. (TSX: GGD) highlights the sale strengthens the Company’s cash position to more than US$20 million (assuming the Company does not exercise the share option) and no debt. The Company is in a strong financial position and has positioned itself to be the consolidator of undervalued juniors in Mexico.
The Company has signed a definitive agreement with Metalla Royalty and Streaming Ltd for the sale of its 2% royalty on the Santa Gertrudis project for cash consideration of US$12 million. The Company has a share option to elect to take US$6M of the purchase price in Metalla common shares at a deemed price of C$0.78 per Metalla common share.
The Company sold the Santa Gertrudis Project to Agnico Eagle Mines Limited (“Agnico”) on November 2, 2017 for cash consideration of US$80 million and was granted a 2% net smelter royalty on the Santa Gertrudis Project.
This is the final step in the monetization of the Santa Gertrudis Project which the Company purchased in 2014. As part of the royalty agreement with Agnico, Agnico has the right of first refusal to match the offer from Metalla. Agnico will be given notice of the sale and has 45 days to determine whether they will exercise their right to match.
Subject to satisfaction of the conditions to closing, the sale of the royalty is expected to occur in the second half of Q4 2018.
Advisors and Counsel
PI Financial Corp. acted as financial advisors to GoGold and Fasken’s acted as GoGold’s legal advisor.
About GoGold Resources
GoGold Resources is a Canadian-based silver and gold producer focused on operating, developing, exploring and acquiring high quality projects in Mexico. The Company’s Parral Tailings project produces silver and gold at a low cash cost. Headquartered in Halifax, NS, GoGold is building a portfolio of low cost, high margin projects.
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