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Aura Energy has completed a number of steps as it moves to finalise its C$4.5 million gold funding transaction with private vehicle Archean Gold.
This deal, which was initially sponsored by TSX-listed Chilean Metals, but now is being completed with Archean Gold, will undertake an Initial Public Offering (IPO) on the TSX likely in Q1 2021.
The transaction will see Aura progressively vending its Mauritanian gold and base metal tenements into Archean Gold for various staged payments. Archean Gold will receive the C$4.5 million payments before October 2021.
On completion of the deal, Aura will not have contributed any cash but will have almost A$5 million applied to its gold tenements which the Company believes to be very prospective. Any rise in the Archean share price will be reflected in Aura's share price.
At the completion of that payment schedule transaction, Aura Energy will own 50% of Archean Gold. This values the gold tenements at C$9 million or A$9.6 million. The proposed transaction will require shareholder approval and the company will advise shareholders when the meeting will take place.
The ASX has imposed a two-year placement holiday on the company for the omission of a single definition in a 60-page convertible note agreement regarding excessive conversions if the market capitalisation of Aura fell below a certain level.
The company said it is working with the ASX to be reinstated on the stock exchange of the Company on the ASX and is proposing to undertake a rights issue and a share purchase plan with the shortfall in the rights issue being placed.
At 2:21pm: (LON:AURA) Aura Energy Limited share price was 0p at 0.3p