Xiana Mining Inc. said May 22 that it signed a definitive agreement with subsidiaries of Glencore PLC to acquire the issued share capital of Chilean copper-gold operation Minera Altos De Punitaqui.
Minera Altos De Punitaqui has operations located about 400 kilometers north of Santiago, Chile, which includes a 3,600-tonnes-per-day concentrator on site and processing ore from three underground and open pit mines.
The miner and its Xiana Chile SPA unit will pay US$25 million in staged cash payments. It will grant a 1.5% net smelter returns royalty to Glencore, payable in excess of 9 million tonnes of ore processed at Minera Altos De Punitaqui.
Xiana will also raise C$10 milllion through the issuance of units at 48 cents each. Each unit will comprise of 1 share and 1 share purchase warrant, exercisable to purchase 1 share at 75 cents each for a period of five years from the unit's issuance.
Existing shareholder Tembo Capital Mining Fund GP LP agreed to subscribe for C$3.8 million in units, as part of the placement, which increases its stake in Xiana to 21%.
Meanwhile, Tembo also agreed to advance a C$9 million convertible loan facility. The loan is convertible into units of Xiana, at a conversion price of 60 cents each.
Each unit is comprised of 1 share and 1 share purchase warrant, exercisable to purchase 1 share at 75 cents each for a period of five years from the loan agreement's signing.
Proceeds from the convertible loan facility will be used to complete the acquisition of Minera Altos De Punitaqui.
