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Chesser inks deal to acquire 5 gold-prospective projects in Senegal

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Chesser inks deal to acquire 5 gold-prospective projects in Senegal

Chesser Resources Ltd. said April 3 that it executed a binding term sheet to acquire Boya Gold Pty. Ltd. and MGC Pharmaceuticals Ltd. unit Erin Mineral Resources Pty. Ltd.

Boya holds a 100% interest in two exploration projects known as Diamba Sud and Diamba Nord, both in Senegal.

Erin, meanwhile, owns an 80% interest in Woye and Garaboureya South gold projects and a 100% stake in the Youboubou exploration project, all also in Senegal.

Under the terms, Chesser will issue 28,571,429 fully paid ordinary shares to Boya and Erin Mineral.

Chesser will also grant 1 million unlisted options, each with an exercise price of 6 Australian cents per share and an expiry date of Dec. 31, 2019, and another 1 million unlisted options, each with an exercise price of 10 cents apiece and due to expire Dec. 31, 2020.

The deal is also subject to certain performance share issues.

Additionally, Chesser is required to undertake a placement of 12.5 million shares at 4 cents apiece to raise a total of A$500,000 before costs, on completion.

Prior to completion, Chesser will also undertake a nonrenounceable rights issue of shares at the same price as the placement on the basis of 1 share for every 3 shares held to raise approximately A$1.6 million before costs.

Moreover, Nick Castleden will join Chesser's board as a nonexecutive director upon completion.

The transaction is expected to close by June 16.