Consolidated Zinc to sell Plomosas project to Impact Silver

Impact Silver is a mining and exploration company which controls the majority of 2 large mineral districts totalling 211 km² in central Mexico, being the Royal Mines of Zacualpan Silver District and the Capire Mineral District adjacent to and southwest of the Zacualpan district. Impact Silver has been in continuous production at the Royal Mines of Zacualpan Silver District for over 17 years, and is considered one of the purest silver producers.

The key terms and conditions of the proposed transaction are set out further in this announcement. The consideration payable under the sale agreement for the proposed transaction consists of:

• A minimum cash payment of US$3 000 000.
• Up to US$3 000 000 in common shares in Impact Silver, based on the lower of the price per common share for the Impact Capital Raising and the volume weighted average price for the 20 trading days immediately prior to the date of execution of the sale agreement.
• The payment of a 12% net profit interest royalty.
• It is anticipated that the company will hold approximately 6% of the issued capital in Impact Silver on completion of the proposed transaction. The cash consideration of US$3 000 000 means that the company is anticipated to be fully funded to accelerate its exploration activities at the Pilbara and Gascoyne projects in Western Australia, whilst retaining a surplus cash balance to actively seek complimentary investments and acquisitions.

Brad Marwood, Executive Chairman of the company advised:

“The proposed transaction presents a good outcome for shareholders as we will realise sufficient cash from the sale of the Plomosas project to fund the planned exploration in Western Australia, as well as retaining exposure to the potential upside of the Plomosas project through the shareholding in Impact Silver and the 12% net profit interest.”

"Impact Silver hold various mining projects in Mexico and will bring their experience in running similar operations to the Plomosas project. Retaining exposure in the Plomosas project and gaining exposure to the other projects held by Impact Silver should be both exciting and rewarding for our shareholders."

"With an enlarged cash balance following completion of the proposed transaction, the company will be able to focus its resources on its Pilbara and Gascoyne projects, with an aim for exploring for lithium and rare earth metals in the region."

Read the article online at: https://www.globalminingreview.com/mining/14022023/consolidated-zinc-to-sell-plomosas-project-to-impact-silver/