PERTH (miningweekly.com) – Perth-based Arrow Minerals has struck a A$2.9-million deal to acquire privately held exploration company Boromo Gold, which holds six exploration projects in Burkina Faso.
Under the terms of the agreement, Arrow would issue ten of its own shares for each Boromo share held, and ten Arrow performance rights for each Boromo performance right.
Boromo’s largest shareholder GenGold Resources Capital has converted 75% of its shareholding in Boromo to performance rights, Arrow said on Wednesday, demonstrating its support for the transaction.
The transaction will be subject to Arrow shareholder approval at a meeting scheduled for early August.
“The acquisition of Boromo gives Arrow and its shareholders immediate access to a portfolio of gold exploration projects in one of the world’s fastest growing gold producing countries,” said Arrow MD Steven Michael.
“Burkina Faso is now the fourth largest gold producer in Africa and has a known gold endowment of over 60-million ounces.
“Boremo has held most of the exploration licences for two years and over that time has completed first pass exploration, including geochemistry, auger drilling and geophysics. There are now drill-ready targets at multiple projects, with drilling at Divole East currently under way.”
Arrow on Wednesday also announced plans to raise A$2-million through a two-tranche equity placement, priced at 1c a share, plus a one-for-two attaching option.
The company has also entered into a strategic alliance with Capital Drilling who will subscribe for A$800 000 of shares in the placement, and will provide Arrow with drilling services in Burkina Faso over an initial two-year period.
“Following the completion of the capital raising, Arrow will be well funded to aggressively explore its gold projects in Burkina Faso and Western Australia, with a focus on high-quality drill targets and year-round exploration,” Michael said.
“Also the support of Capital Drilling, both strategically and financially, will enhance Arrow’s ability to complete multiple drill programmes in Burkina Faso.”