Proceeds to acquire plant and equipment used to operate El Sauzal Mine
By Devika Patel
Knoxville, Tenn., Sept. 21 – Timmins Gold Corp. said it will conduct a C$6 million non-brokered private placement of units.
The company will sell 20 million units of one common share and a half-share warrant at C$0.30 per unit.
Each whole warrant is exercisable at C$0.35 for two years. The strike price reflects a 29.63% premium to the Sept. 18 closing share price of C$0.27.
Proceeds will be used to acquire the complete process plant and select auxiliary equipment used to operate Goldcorp Inc.’s El Sauzal Mine in Chihuahua, Mexico. The acquisition is conditional upon the company completing the placement. The plant will be bought for C$8 million in the form of C$1 million in cash, to be paid immediately; C$3 million in the form of 10 million common shares, valued at C$0.30 per share; and C$4 million in cash, to be paid one year from Sept. 21.
“The purchase of the El Sauzal Plant is projected to save in the range of $40 to $60 million in initial capital expenditure when Timmins Gold constructs Ana Paula, not only in terms of equipment and infrastructure direct costs, but also indirect costs and EPCM costs,” chief executive officer Bruce Bragagnolo said in a press release. “In addition, it will derisk the project by reducing the risk of both equipment capex overruns and delays in scheduling equipment deliveries. The El Sauzal flowsheet is very similar to the base case flowsheet outlined in the Ana Paula PEA and will require essentially all of the items we have acquired. Some additional items such as a gravity circuit may be required based on the results of ongoing metallurgical studies.”
Timmins Gold is a resource exploration company based in Vancouver, B.C.
| Issuer: | Timmins Gold Corp.
|
| Issue: | Units of one common share and a half-share warrant
|
| Amount: | C$6 million
|
| Units: | 20 million
|
| Price: | C$0.30
|
| Warrants: | One half-share warrant per unit
|
| Warrant expiration: | Two years
|
| Warrant strike price: | C$0.35
|
| Agent: | Non-brokered
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| Pricing date: | Sept. 21
|
| Stock symbol: | Toronto: TMM
|
| Stock price: | C$0.27 at close Sept. 18
|
| Market capitalization: | C$98.32 million
|
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