- New Talisman Gold Mines Limited signed a binding option to acquire Broken Hills Historic Gold Mine Limited, privately-owned underground gold mine in NZ.
- MTL shares witnessed an uptick of 20% on 27 January 2021 post the announcement.
- The deal is liable to Due Diligence by New Talisman and approval by NZPAM.
- As per the new terms, Victor Rabone, Director of Broken Hills will be chosen to the board of New Talisman.
New Talisman Gold Mines Limited (NZX:NTL,ASX: NTL) share price was trading up at NZ$0.006, up by 20% on 27 January 2021. NTL shares saw an uptick after the company rolled out a release announcing that it has signed a binding option to acquire Broken Hills Gild Mine.
NTL is a prominent NZ minerals development and exploration company with a mining permit covering the Talisman mine.
On 27 January 2021, the NTL Board declared that it had entered into a binding contract to buy 100% shares in Broken Hills Historic Gold Mines Limited.
Broken Hills Gold Mine is a privately-owned underground gold mine in NZ. Rabone family has been the owner of the mine for more than 20 years and has extensive underground mining expertise.
Broken Hills holds 100% of Mining Permit 53173 and Special Purpose Mining Permit 42024 covering the historic Broken Hills Mine near Tairua on the Coromandel Peninsula.
Terms of the agreement
Here’s a look at the terms agreed between New Talisman and Broken Hills.
- New Talisman has an initial 90-days Due Diligence period after the payment of $100,000 with an added right to extend for up to 90 days.
- The deal is subject to Due Diligence by NTL and approval by New Zealand Petroleum and Minerals (NZPAM).
- The terms reflect that any share-based consideration will be issued at NZD 0.007 cents per share.
The Final consideration inclusive of the $100,000 will be decided after the conclusion of Due diligence and final transaction documents. As per the new agreed terms, Victor Rabone, Director of Broken Hills will be appointed to the board of New Talisman.
Mathew Hill, CEO of NTL, stated the deal was the key milestone for NTL’s strategy. He stated that the Broken Hills mine was a major asset that would complement the existing mineral assets of New Talisman. NTL plans to build on the Rabone family’s remarkable history of gold and silver production at Broken Hills gold mine.
NTL’s 2020 performance and way ahead
The Group faced some challenged during the first half of 2020 due to COVID-19 induced lockdowns and travel limitations, along with delays in the shipping of materials from overseas.
However, NTL fared well in H2 of 2020 with the arrival of all materials required to commence work, completion of the revised mine planning and principal risk calculations, which were needed to start the Mystery activities early in 2021.
The board has instructed management to deliver detailed reviews of specific areas of focus in the second stage of the strategic review. It plans to increase the use of in-house expertise for planning and permitting. Many suitable sites have been discovered for a plant and are being critically evaluated by the Group.