TORONTO, Nov. 14, 2017 /CNW/ – Argonaut Gold Inc. (TSX: AR) (the “Company”, “Argonaut Gold” or “Argonaut”) is pleased to announce its has reached an agreement with Primero Mining Corp. (“Primero”) whereby it will acquire the Cerro del Gallo project (“CDG” or the “Project”) through the purchase of all of the issued and outstanding shares of the Primero subsidiary San Anton Resource Corporation for cash consideration of $15 million, which is payable upon closing. Argonaut expects to be able to recover approximately $1.7 million of value added tax, which reduces the total purchase price to $13.3 million. The Company expects the transaction to close on or before November 30, 2017.
Argonaut Gold is a Canadian gold company engaged in exploration, mine development and production activities.
Pete Dougherty, President & CEO stated: “We view the acquisition of the CDG as a low risk, high reward investment for Argonaut shareholders. CDG is a project in our own backyard where we have the ability to leverage our existing operations and projects team’s skill sets. We view CDG as a pipeline project that fits well within our portfolio of Mexican assets.
This acquisition is an opportunity to acquire a project within a well-known jurisdiction with known mineral reserves, upside resource potential, excellent infrastructure and at a reasonable investment. With $37 million in cash at September 30, 2017, projected cash flow from operations and an undrawn $30 million corporate revolver, Argonaut will remain in a strong financial position after completing the transaction.”
About CDG
The CDG deposit is located in the state of Guanajuato in central Mexico, approximately 270 kilometres northwest of Mexico City in an active mining district. The property is accessible by road, rail and air services. Additionally, there is availability of a skilled local workforce, grid power, water, sealed roads, equipment suppliers and established transport routes.
Source: http://www.newswire.ca/