The Australia-based mining company Azure Minerals announced it has entered binding conditional sale agreements with the intention to sell all its Mexican assets to Bendito Resources. Following this transaction, the company aims to focus on its Australian projects.
The company will sell the Alacran, Oposura and Promontorio projects. The transaction is valued at US$14.3 million and will be made in two stages. In the first stage, Azure will receive an initial payment of US$4.3 million and a 10 percent equity interest in Bendito Resources, which is valued at US$1.4 million. In the second stage, the company will receive US$2.8 million in cash and US$5.7 million in shares within 18 months of the transaction’s completion. The operation is subject to shareholders' approval.
“This is a great outcome for Azure and our shareholders. We have realized a significant cash return for the assets while retaining exposure to the upside as the projects are fully developed… We still see potential in these projects, and it makes sense for them to sit within a dedicated special-purpose group focused solely on Mexico,” said Tony Rovira, CEO, Azure Minerals.
The operation will allow Azure to focus on its Andover Ni-Cu Project, located in West Australia, while keeping part of the benefits of its Mexican assets through participation in Bendito Resources. “The team behind Bendito has a successful track record of identifying, acquiring, developing and operating projects, so retaining exposure to these assets that we know so well should be both exciting and rewarding for Azure shareholders,” Rovira added.
Within 18 months of the completion of the agreement, Bendito Resources plans to list on the Toronto Stock Exchange (TSX) with the further acquired projects forming its core assets. Azure considers this to be crucial since it is expected to own over 15 percent of Bendito Resources’ issued capital.
Bendito Resources is a mineral acquisition and development company focused on progressing late-stage exploration and development projects. Recently, the company announced it plans to conduct intensive drilling programs at Alacran and Oposura.
At Oposura, the company will undertake expansion drilling in conjunction with further geotechnical and metallurgical test work with the aim to deliver an updated Preliminary Economic Assessment (PEA) in approximately 18 months. For Alacran, the expansion drilling is intended to increase the Inferred and Indicated Mineral Resources that were previously defined by Azure. The company hopes to define a larger resource base to undertake a PEA.