- Aura Minerals (TSX:ORA) will purchase Para Resources’ (TSXV:PBR) wholly owned subsidiary Z79 Resources Inc
- The purchase was contemplated by a term sheet announcement by Aura and Para released in February
- Z29 owns a 94 per cent interest in Gold Road Mining Corp, which in turn owns the Gold Road mine located in Arizona
- Gold Road Mining Corp also owns several options to acquire adjacent parcels of land next to the Gold Road mine
- Para Resources (PBR) was up 16 per cent, with shares currently trading at $0.022
- Aura Minerals (ORA) was up 3.66 per cent, with shares currently trading at C$85.00 and a market cap of $370 million
Aura Minerals (TSX:ORA) is purchasing a subsidiary of Para Resources (TSXV:PBR), for the hefty fee of C$1.37, equivalent to one US dollar.
The announcement was foreshadowed to the market in a term sheet revealed on February 10.
The Para Resources Subsidiary Z29 owns a 94 per cent interest in the Gold Road Mining Corp, which in turn owns the Gold Road mine in Arizona.
Aura will assume the liabilities owing from Para Resources to PPG Arizona Holding LP, an affiliate of Pandion Mine Finance. Para Resources owe Pandion Mine Finance approximately $47.5 million.
As part of the deal, Aura will have the option to buyout the obligation from Pandion for $32 million if they make the payment in full within 12 months of the closing of the agreement.
Aura will also advance $8 million in two equal tranches to Z79, with the first occurring on closing of the share purchase and second one month after closing.
These funds will be used for the development and the restart of the Gold Road mine.
The deal is expected to close on March 20, following Para’s shareholders agreeing.
believes this financing is key the company’s future efforts.
“The closing of this transaction allows Para to focus on our Columbian strategy and to move forward, transitioning into a producing and profitable mining and exploration company,” he said.
Para Resources (PBR) is up 16 per cent, with shares trading at $0.022 at 2:35pm EST.
Aura Minerals (ORA) is up 3.66 per cent, with shares trading for C$85.00 at 2:35pm EST.