TSX-listed Santacruz Silver has, through its wholly-owned subsidiary Carrizal Holdings, acquired a 50% shareholding in PCG Mining, which is a holding company that owns 100% of private Mexican mining company Carrizal Mining.
The shares were bought from one of PCG’s shareholders for $500 000 in cash; the forgiveness of about $264 000 in debt owed by the vendor to Carrizal Mining; the transfer of a $494 000 life-insurance policy and three vehicles valued at $180 000 from Carrizal Mining to the vendor.
Carrizal Mining’s assets include a 20% working interest in Santacruz’s Veta Grande project. The transaction, therefore, enables Santacruz to regain full ownership of the project.
The company has entered into a parallel agreement, with binding effect as of May 21, to acquire the remaining 50% of the outstanding shares of PCG that are owned by Santacruz COO Carlos Silva.
The consideration to be paid by Santacruz to Silva with respect to that acquisition is 30-million Santacruz shares at a deemed price of C$0.05 apiece.
The transaction with Silva remains subject to receipt of final approval from the TSX-V, as well as Santacruz obtaining approval from the disinterested shareholders of the company pursuant to exchange requirements, as the consideration shares will represent more than 10% of the company’s outstanding shares prior to closing.
Silva does not currently hold any common shares of the company and if the transaction is concluded, he will hold 14.7% of Santacruz’s shares.
“The acquisition of a 50% interest in Carrizal is an important first step towards returning to 100% ownership rights in the Veta Grande project, subject to receiving the necessary approvals to complete the purchase of the remaining 50% of Carrizal,” commented Santacruz CEO Arturo Prestamo in a statement on Tuesday.