Golden Arrow Resources Corp. (GRG:TSX.V; GARWF:OTCQB; G6A:FSE) announced in a news release it entered into an agreement to sell its 25% interest in Puna Operations to SRR Mining, its sole joint venture partner in the entity, for CA$44.4 million.
The total consideration going to Golden Arrow will consist of CA$3 million in cash, CA$25.9 million in common shares of SSR Mining and CA$14.5 million in cash for repaying in full at closing the outstanding principal and accrued interest Golden Arrow owes under the July 2018 credit agreement with SSR Mining. Consideration also includes CA$1 million to be generated through the return, for cancellation, of 4,285,714 Golden Arrow common shares that SSR Mining owns.
Also for Golden Arrow, the company notes the transaction will afford it a direct stake in SSR Mining and a low-risk exposure to Puna Operations. It will strengthen the balance sheet of the Vancouver-based exploration and production firm and provide it with financial flexibility. Finally, Golden Arrow will be able to focus entirely on its other assets as well as finance, explore, develop and monetize additional mining projects.
"The sale of our equity position in Puna Operations is a landmark achievement for the company," Golden Arrow Executive Chairman, President and CEO Joseph Grosso said in the release. "The transaction provides Golden Arrow with a strengthened financial position to focus on delivering shareholder returns through the exploration and development of our exciting exploration portfolio in South America."
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