Evergreen, Colo.-based Anatolia Minerals Development (AMCD.U-C) and Toronto-based Rio Algom (ROM-T) have agreed to jointly explore base and precious metal prospects in Turkey.
The agreement, which is expected to be made formal by mid-July, will see Rio purchase 1.8 million Anatolia shares at US85 cents each. Anatolia must spend US$1 million from the proceeds of the share purchase on exploration of its Yenipazar and Armutbeli properties over an 18-month period; the rest of the proceeds (roughly US$500,000) will go into Anatolia’s general funds.
In addition, Rio may buy up to US$2.5 million worth of Anatolia shares at a 10% discount; in doing so, it would delay the start of its earn-in period by up to 12 months.
In order to earn a 60% direct interest, Rio must spend US$10 million per property. At Anatolia’s option, Rio can earn up to a 70% interest in each property by spending up to US$27.5 million per property and producing a bankable feasibility study.
Anatolia will be project operator until Rio earns a majority interest.
Project financing is expected to be arranged by Rio, provided development is economically justified.
The deal will also see Rio appoint one voting member to Anatolia’s board and participate in the approval of annual budgets and programs.
Anatolia has 14.7 million shares issued and outstanding, or 24.1 million fully diluted.
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