Kolar Gold has a 15.4% stake in Kalevala Gold Oy, the recently incorporated Finnish company established to develop various licences subject to the joint venture with Mineral Exploration Network (Finland) Limited announced on 13 October.
Kolar Gold has issued 8,500,000 new ordinary shares to MENF in return for 150 shares in Kalevala Gold.
The new shares have been issued at an implied price of 1.6p per share by reference to the consideration of €150,000.
JV summary and update:
- Kalevala Gold Oy has been incorporated in Finland as the JV operating company
- Following payment made of €150,000 in cash as detailed in the Announcement and the issue of the new shares, Kolar currently owns 15.4% of Kalevala
- Kolar has fully budgeted commitment of €350,000 to increase its stake in Kalevala to 28.3% by 28 February 2017
- Kolar has the option to increase equity holding in Kalevala up to 50% by the end of Q2 2017
- Kolar Gold CEO, Cameron Parry, has been appointed to the board of Kalevala
- Kalevala targeting production of 100 kilogrammes of gold through bulk sampling in Q3 2017
- MENF's interest in Kolar circa 4% of the enlarged issued share capital
Parry said: "We are pleased to report that Kolar Gold now owns 15.4% of the newly established Finland operating company, Kalevala, with high grade gold targets within licences covering 24sq km in central East Finland.
"Should 100 kilos or more of gold be produced from our planned 10,000 tonne gold ore bulk sampling campaign in Q3 this year, Kalevala will generate material revenues, based on today's gold price with the potential for such sums to be reinvested into further exploration or the possible return of capital to Kalevala shareholders through dividends.
"We look forward to progressing our work in Finland over the coming months and updating the market accordingly as we head towards our planned first gold production."
At 9:10am: (LON:KGLD) Kolar Gold share price was +0.08p at 1.03p