Endeavour Silver sells El Cubo mine to VanGold for US$15M

Endeavour Silver (TSX: EDR; NYSE: EXK) has agreed to sell its El Cubo mine and related assets to Mexico-focused miner VanGold Mining (TSXV: VGLD).

Endeavour will receive a combination of US$7.5 million cash, US$5 million in VanGold shares and US$2.5 million in unsecured promissory notes, for a total payment of US$15 million.

The El Cubo mine, located in Guanajuato, Mexico, includes two previously operating underground mines and a flotation plant. Operations were suspended at the end of November 2019 due to depletion of the mine’s reserves.

According to Endeavour CEO Bradford Cooke, VanGold represents “an ideal fit” to advance the asset given the proximity of the Pinguico property to the El Cubo plant.

Upon completion of the sale, Endeavour would become VanGold’s largest shareholder, with 16.1% of VanGold’s updated share capital.

VanGold may also pay Endeavour up to US$3 million in additional payments contingent on certain production milestones and market conditions,

Upon achieving production of three million silver-equivalent ounces from the El Cubo mill, Endeavour would be required to make a payment of US$1 million.

A US$1 million payment would be made to VanGold should the price of gold closes at or above US$2,000 per oz. for 20 consecutive days within two years after closing. Another US$1 million would be paid if gold prices are at or above US$2,200 per oz. for 20 consecutive days within three years.

Endeavour Silver  has a market capitalization of $913.2 million.

This Fast News item first appeared in MINING.com, part of the Glacier Resource Innovation Group.