Perseus Mining Limited has announced intentions to acquire a 15 per cent interest in Orca Gold Inc from Resolute Mining Limited.

Orca Gold is a gold developer, listed on the Toronto Stock Exchange (TSX) Venture Exchange. Its key assets include a 70 per cent interest in the Block 14 Gold Project in northern Sudan and a 31.5 per cent interest in Montage Gold Corp, which owns the Koné Gold Project in northern Côte d’Ivoire.

The agreement shows a total acquisition of 39,092,233 million common shares in Orca from Resolute Mining, representing 15 per cent of Orca’s common shares on issue. The Resolute Mining share acquisition was executed at a price of approximately 44.8 Canadian cents per Orca share representing the 10-day volume-weighted average price (VWAP) of Orca on the TSX-V to 28 January 2022.

Total consideration for the Resolute share acquisition is approximately Canadian $17.5 million. Prior to the Resolute share acquisition, Perseus held no common shares or other securities of Orca.

Simultaneous with the Resolute Mining share acquisition, Perseus has agreed to provide Orca with a US$5.0 million short term loan facility. Orca plans to use the loan for working capital and for further exploration and development activities at Block 14. The Orca loan facility will mature on 30 June, 2022 with interest charged at a rate of 7.5 per cent per annum.

Perseus’s Managing Director and CEO Jeff Quartermaine commented:

“The acquisition of the 15% interest in Orca provides Perseus with a pivotal position in Orca that gives us a platform from which to further evaluate what appears to be a very exciting potential growth opportunity.

“Perseus has recently achieved an annualised gold production rate of 500,000 ounces of gold per year from its three existing operating mines… While it expects to be able to maintain this level of production based on exploration success around its existing gold mines, we are always seeking to identify value accretive inorganic growth opportunities. We believe that Orca could represent such an opportunity.”
Jeff Quartermaine, MD Perseus Mining

Completion of Transaction Subject to Conditions

Prior to the Resolute share acquisition, Perseus had engaged in exclusive discussions with Orca, with respect to a possible change of control transaction whereby Perseus would acquire all the outstanding securities of Orca.

Orca potentially provides Perseus with exposure to two highly prospective assets with significant resource bases and is consistent with Perseus’ strategy of building a platform of long life, highly profitable African gold assets.

While discussions regarding a possible transaction with Orca are underway, any change of control transaction would be subject to, among other things, the completion of outstanding due diligence. This will include an assessment of the geopolitical situation in Sudan by Perseus and reaching agreement with Orca on definitive terms. As a result, there can be no assurance that any such transaction will be completed.

Depending on market conditions and other factors, Perseus may from time to time in the future, adjust its direct or indirect ownership as well as control over securities of Orca through market transactions, private agreements, subscriptions from treasury or otherwise.

The Resolute share acquisition and Orca loan facility together demonstrate the Company’s intent on working collaboratively with Orca and the Government of Sudan to potentially progress an exciting development opportunity, the statement indicated.