JOHANNESBURG (miningweekly.com) – TSX- and Aim-listed Aureus Mining has secured a $30-million equity investment that will strengthen its balance sheet and fund working capital as Aureus completes the restart of the processing plant at the New Liberty gold mine, in Liberia, by mid-June.
Aureus on Wednesday said it had entered an equity financing agreement with Turkish gold exploration and development company MNG Gold Jersey that would see the privately-owned firm become a 55% shareholder in Aureus, with three representatives appointed to the board.
“MNG Gold is steadily expanding the resource and production base of its business and the investment in Aureus represents a further progression of this strategy in a country that is well-known and important to the MNG group,” said GM Serhan Umurhan.
“We believe this transaction, which will result in MNG Gold becoming a major shareholder, will provide Aureus with an exciting future as we prepare to restart production at New Liberty and aim to optimise the asset to deliver on its full potential.
“MNG Gold has strong financial backing, operational experience and is an existing operator in Liberia. This transaction will recapitalise the company and places it in a much stronger position to move forward,” added Aureus chairperson David Netherway.
Following the conclusion of the transaction, Aureus CEO David Reading would resign, with Umurhan stepping in as successor. Current MNG Gold CFO Geoff Eyre would take the place of Aureus CFO Paul Thomson, who would also resign, but stay on in a consultancy role for the next 12 months.
Umurhan and Eyre would be appointed to the board, along with Mehmet Nazif Gűnal who would join the Aureus board as nonexecutive chairperson.
Netherway, Loudon Owen and Jean-Guy Martin would continue as nonexecutive directors, while Karin Ireton and Adrian Reynolds would resign from their posts.
Meanwhile, the funds raised from the two-tranche transaction would be used to reduce outstanding creditor balances, bolster working capital and facilitate the ramp-up of the processing plant which is scheduled to be restarted from mid-June.
Aureus had secured a four-month default waiver and standstill agreement from its lenders to allow for time to reschedule the debt repayment profile.
Edited by: Creamer Media Reporter
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