Halifax, NS – GoGold Resources Inc. (TSX: GGD) (“GoGold”, “the Company”) 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 (“Metalla”) 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 (TSX: GGD) 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. For more information visit gogoldresources.com.
For further information please contact:
T: 416 855 0435
E: [email protected]
The securities described herein have not been, and will not be, registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), or any state securities laws, and may not be offered or sold within the United States or to, or for the benefit of, U.S. persons (as defined in Regulation S under the U.S. Securities Act) except in compliance with the registration requirements of the U.S. Securities Act and applicable state securities laws or pursuant to exemptions therefrom. This release does not constitute an offer to sell or a solicitation of an offer to buy of any of GoGold’s securities in the United States.
This news release may contain “forward-looking information” as defined in applicable Canadian securities legislation. All statements other than statements of historical fact, included in this release, including, without limitation, statements regarding the Parral tailings project, future operating margins, future production and processing, and future plans and objectives of GoGold, constitute forward looking information that involve various risks and uncertainties. Forward-looking information is based on a number of factors and assumptions which have been used to develop such information but which may prove to be incorrect, including, but not limited to, assumptions in connection with the continuance of GoGold and its subsidiaries as a going concern, general economic and market conditions, mineral prices, the accuracy of mineral resource estimates, and the performance of the Parral project. There can be no assurance that such information will prove to be accurate and actual results and future events could differ materially from those anticipated in such forward-looking information.
Important factors that could cause actual results to differ materially from GoGold’s expectations include exploration and development risks associated with GoGold’s projects, the failure to establish estimated mineral resources or mineral reserves, volatility of commodity prices, variations of recovery rates, and global economic conditions. For additional information with respect to risk factors applicable to GoGold, reference should be made to GoGold’s continuous disclosure materials filed from time to time with securities regulators, including, but not limited to, GoGold’s Annual Information Form. The forward-looking information contained in this release is made as of the date of this release.