Damara Gold Corp. said Sept. 6 that it agreed to a reverse takeover of privately held New Found Gold Corp., which owns exploration assets in Ontario and Newfoundland and Labrador.
Under the terms, Damara will acquire the entire share capital of New Found Gold in exchange for the issuance of its shares to the latter's shareholders. The company will continue with the business of New Found Gold and remain a tier 2 mining issuer.
The transaction is expected to close in the fourth quarter. Before completion, Damara will consolidate its shares on a 1-for-6 basis and change its name to New Found Gold Corp.
Meanwhile, New Found Gold plans to raise between C$7.5 million and C$13.5 million from a private placement of subscription receipts.
Upon completion, Damara's current board and management will step down.