Kalimantan shares fly after Indonesian copper-gold deal
AIM-listed Kalimantan Gold has agreed with Australia-based Tigers Realm Copper to purchase a 40% interest in the Beutong copper-gold project in Sumatra, Indonesia.
Asiamet Resources Limited (DI)
0.83p
14:09 26/04/24
FTSE AIM All-Share
755.82
15:10 26/04/24
Mining
10,563.34
15:09 26/04/24
The project is estimated to contained metal of 1,241m Ibs copper, 373,000 oz of gold, 5.7m oz silver and 20m Ibs molybdenum.
Having signed a non-binding letter of intent, the gold miner will issue about 170.4m shares and more than 14.6m share purchase warrants to the Australia-based firm after it has completed a US$3m equity placement.
Kalimantan said that it will receive a loan from Tigers, which will be used to fund 50% of its share of due diligence and transaction related costs for the deal, which will be interest free and paid back using money from the placing.
The Australian firm is also set to provide an additional $250,000 interest-free loan to ensure operations are maintained during the due diligence period. However, while the loan is also set to be paid back via funds raised in the placing, the gold miner is entitled to settle the debt via shares, should the capital raising not go ahead as planned.
"The acquisition of Beutong, combined with the company’s own KSK copper mineral resource and its Jelai gold prospect creates a quality portfolio of pre-development copper and gold assets all located within Indonesia,” said Faldi Ismail, Kalimantan chairman and chief executive.
“All three projects have significant growth potential and their combination will create a platform upon which to continue to build a significant regional Asian focused copper-gold business."
Upon completion of the deal, Ismail will be replaced in his current roles at Kalimantan by Tigers director Tony Manini, though he’ll remain as a director.
Kalimantan shares jumped 77.78% to 3.20p at 11:24 on Wednesday.