- Altamira Gold (TSXV:ALTA) is repurchasing two 1.75 per cent net smelter royalty from its former joint venture partner
- ECI Exploration and Mining held the royalties for the Crepori and Apiacas gold projects, in Brazil
- Altamira will offer up two million common shares, alongside four million share warrants in exchange for the royalties
- Altamira hopes the net smelter royalty buy back will give provide creative financing options to progress its nearby flagship Cajueiro project
- Altamira (ALTA) is in the grey and is trading at C$0.09 per share
Altamira Gold Corp (TSXV:ALTA) has bought back two 1.75 per cent net smelter return royalties from ECI Exploration and Mining Inc.
ECI held the net smelter fee for two separate projects Altamira now owns in Brazil.
ECI was Altamira’s former joint venture partner in Brazil, and both companies hold substantial amounts of each other’s shares.
The first is the Crepori gold project in the Brazilian State of Para, and the second is the Apiacas gold project in the Brazilian state of Mato Grosso. Crepori is made up two mineral claims, and Apiacas is made up of four.
Instead of raising cash for the purchase of the net smelter fee, Altamira is instead offering ECI two million common shares, along with four million common share warrants.
The warrant price will sit at C$0.25 and will be active for 36 months from the date of issuance. That represents a substantial premium on Altamira’s current price of nine cents.
The highest dilution possible in the deal would be six million shares, which represents a fairly negligible dilution as Altamira has just under 100 million offered shares anyway.
By repurchasing the net smelter royalty, the company hopes to complete further exploration. The repurchase should also give Altamira some flexibility in financing.
Altamira is about to being construction of 1000 tonne a day processing plant on its flagship Cajeurio project and may need the additional funds to begin production on the site.
Altamira Gold Corp (ALTA) is in the grey and is trading at nine cents per share at 12:40 pm EDT.