West Perth-based minerals explorer Avoca Resources Ltd will sell its South Australian iron oxide copper-gold project to Victoria-based Rex Minerals Ltd for a scrip issue, the company has announced.
Rex, which aims to list on the Australian Stock Exchange in August, will issue 6 milliion shares worth $1.5 million to Avoca, giving the company an 11 per cent stake when Rex lists. Avoca will also be issued 1 million four year options to acquire Rex shares at an issue price of 30 cents.
The full text of a company announcement is pasted below
Avoca Resources Limited (Avoca) is pleased to announce that it has reached a conditional agreement with Rex Minerals Limited (Rex) for the sale of Avoca's South Australia Iron Oxide Copper-Gold Project (Project). The Project will form one of the lead projects in the new Rex IPO, which is scheduled to list on the ASX in or around August this year. Avoca's divestment of the Project is conditional upon Rex being admitted to the Official List of the ASX.
The consideration to Avoca for the sale of the Project is 6,000,000 shares in Rex, which at a listing price of $0.25 per share is equal to $1.5 million. At listing, Avoca will hold an 11% interest in Rex. In addition Avoca will be issued 1,000,000 four year options to acquire Rex shares at an exercise price of $0.30 per share.
The divestment of the Project to Rex will allow Avoca to maintain its management focus on beginning production at its Trident project at Higginsville this year; whilst maintaining its aggressive exploration campaign at Higginsville and the commencement of exploration at Mt Fisher. Avoca will also become a substantial shareholder in a new exploration company with exciting gold and copper-gold prospects in Victoria and South Australia.
