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Luna Gold, JDL Gold to merge into Trek Mining

Luna Gold Corp. and JDL Gold Corp. said Feb. 1 that they have agreed to combine their businesses to create a multi-asset mining company to be called Trek Mining Inc.

Under the deal, JDL will acquire all Luna shares at a ratio of 1.105 JDL shares for each Luna share.

Additional terms include the settlement of the Pacific Road Resources Fund II L.P. debt and the US$20 million Sandstorm Gold Ltd. debt facility upon completion of the deal, which is expected by the end of March.

Concurrent with the merger, JDL looks to raise approximately C$27 million in a non-brokered private placement financing of subscription receipts of JDL at a price of C$2.00 each. Pacific Road will backstop the full amount of the financing.

Each subscription receipt entitles holders to a unit that comprises one JDL common share and one purchase warrant, which will entitle the holder to purchase one common share of Trek Mining at an exercise price of C$3.00, expiring on Oct. 6, 2021.

Upon the deal's closing, Trek Mining will consist of an asset base of C$66 million in cash and a portfolio of gold, copper and molybdenum assets in the Americas.