11/05/2020 - 11:41

Adriatic Metals buys Canadian explorer

11/05/2020 - 11:41

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Adriatic Metals has signed a binding agreement to purchase Toronto-listed Tethyan Resource Corp for around $16 million.

The combined group will have four key assets, including Adriatic’s Rupice and Veovaca precious metals projects in Bosnia.

Adriatic Metals has signed a binding agreement to purchase Toronto-listed Tethyan Resource Corp for around $16 million.

UK-based Adriatic, which is dual-listed on the ASX and TSX, will gain all of the shares in Tethyan as well as two brownfields projects in Serbia’s Raska district for $CAD0.184 ($A0.20) per Tethyan share, valuing the company at $CAD14.7 million ($A16 million).

Adriatic Metals will also provide a €1.3 million ($A2.15 million) secured convertible loan to Tethyan in three tranches.

The loan enables Tethyan to close its transaction for the acquisition of Serbian company EFPP, which holds the two exploration licences for the Kizevak and Sastavci brownfields projects.

Adriatic managing director Paul Cronin says, with the exploration licences, the acquisition represents a unique opportunity for the company to add to the quality of its Vares project in Bosnia.

“Applying our team and strong balance sheet to Tethyan’s assets positions us well to proceed through the project development cycle,” he said.

“These are past-producing mines, and the historical data we have reviewed provides ample confidence that we are adding a significant value to our portfolio with minimal outlay and dilution to our existing shareholders.”

The acquisition brings Adriatic’s balance sheet to $23.8 million in cash and no debt as at March 31.

The Western Australia-established company will also welcome Tethyan chief executive Fabian Baker to its board as corporate development manager.

Mr Baker said he was excited to combine both companies’ assets, citing Adriatic’s excellent reputation in the Balkans.

The combined group will have four key assets, including Adriatic’s Rupice and Veovaca precious metals projects in Bosnia.

“We are confident the combined assets and team will go forward to bring high quality assets into production in a timely and sustainable manner, ensuring lasting benefits for both our shareholders and the communities in which we operate,” Mr Baker said.

Shares in Adriatic Metals were up 4.3 per cent at 12:50pm AEST to trade at $1.34.

The company listed on the ASX in 2018 after raising $10 million through its IPO.

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