An upgrade of the company that exploits gold in Marmato, the legendary mine located in Caldas, was just announced, including the change of name, the arrival of new investors, and changes in the directives. “We have commenced a private placement financing with a group of investors referred primarily by Aris Gold Corporation.
This is the announcement made by the Canadian company Caldas Gold, created in 2020 and in charge of gold exploitation in Marmato, considered one of the largest scale exploitation mines. The arrival of investors will immediately lead to movements in the company’s management and board of directors, as well as a change in the company’s name to Aris Gold Corporation.
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Gran Colombia will own 45% of the company
According to the company, once the financing is completed, Gran Colombia Gold Corp. is expected to become a shareholder with approximately 45 percent of Caldas Gold, from 75 percent. With the new percentage of ownership, Aris will have the right to nominate two directors to the board of Caldas Gold upon completion of the transaction.
Under the financing, the company agreed to sell, on an non-brokered private placement basis, a total of 37,777,778 Company subscription receipts, at a price of $2.25 each, for $85 million (the offering).
According to the information provided to Semana, the company will have “a highly experienced board of directors with a proven track record of creating very successful precious metal mining companies. These include Equinox Gold; Endeavour Mining; Wheaton River Minerals (which became Goldcorp and now Newmont); Wheaton Precious Metals; and Yamana Gold.
The incoming group of candidates to the Board and the company’s management intend to participate, on an individual basis, in the offering, for a total of US$38 million.
“Aris Gold’s vision is to create a diversified precious metals mining company through a disciplined growth strategy with a focus on creating value for stakeholders by generating free cash flow and implementing industry-leading sustainability programs,” the company said.
Upon completion of the Aris Transaction, the Marmato license extension process will be completed and the Deep Zone expansion project will be fully financed prior to the start of construction, which is expected by the second half of 2021.
The Company is expected to have a cash balance of $190 million and approximately 137.6 million of issued shares outstanding at the end of the Aris Transaction.
The mining activity generates 350,000 direct jobs and 900,000 indirect jobs
The private placement price per subscription receipt of $2.25 corresponds to a premium of 14 percent over the closing price of Caldas Gold common shares, as recorded by the market on Friday, November 20th, 2020.
Neil Woodyer, CEO of Aris Gold, believes that “the Marmato mine, with its current production and expansion plans backed by a large scale gold resource, represents an ideal platform for us to build a major gold mining company. With this US$ 85 million financing, the current US$ 110 million ongoing financing with Wheaton Precious Metals and the new support from Orion Mine Finance, the expansion program is fully funded”.
He added that the recent pre-feasibility study described that the average potential annual gold production would be 165 (Kozs) from 2024 to 2033, once the mine is in full production.
In fact, Woodyer highlighted the result of recent programs underway. In early November, Serafino Iacono, president and CEO of Caldas Gold, had mentioned the figures, according to which, “third quarter production recovered after a challenging second quarter affected by the Covid situation-19″.
Caldas Gold’s November 11th statistics indicated that production in the third quarter of 2020 amounted to 6,899 ounces of gold, 11 percent more than in the third quarter of last year and 79 percent more than the second quarter of 2020, which was strongly affected by the challenges associated with the national quarantine on Covid-19. During the first nine months of 2020, the Company produced a total of 16,651 ounces of gold and 23,404 ounces of silver, which compares to 18,693 ounces of gold and 29,136 ounces of silver in the first nine months of last year. In October alone, the Company produced 2,487 ounces of gold.
DISCLAIMER: This article was written by a third party contributor and does not reflect the opinion of Born2Invest, its management, staff or its associates. Please review our disclaimer for more information.
This article may include forward-looking statements. These forward-looking statements generally are identified by the words “believe,” “project,” “estimate,” “become,” “plan,” “will,” and similar expressions. These forward-looking statements involve known and unknown risks as well as uncertainties, including those discussed in the following cautionary statements and elsewhere in this article and on this site. Although the Company may believe that its expectations are based on reasonable assumptions, the actual results that the Company may achieve may differ materially from any forward-looking statements, which reflect the opinions of the management of the Company only as of the date hereof. Additionally, please make sure to read these important disclosures.
First published in Semana, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.
Although we made reasonable efforts to provide accurate translations, some parts may be incorrect. Born2Invest assumes no responsibility for errors, omissions or ambiguities in the translations provided on this website. Any person or entity relying on translated content does so at their own risk. Born2Invest is not responsible for losses caused by such reliance on the accuracy or reliability of translated information. If you wish to report an error or inaccuracy in the translation, we encourage you to contact us.
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