Resolute takes bigger stake in Kilo

PERTH (miningweekly.com) – Gold miner Resolute Mining has signed a share swap agreement with explorer Osisko Mining to acquire a 12.9% stake in Canada-based gold explorer Kilo Goldmines.

Under the terms of the agreement, Resolute will acquire Osisko’s 21.86-million shares in Kilo in exchange for 1.45-million of its own shares. Osisko will also grant Resolute the right of first refusal to acquire its 21.1-million warrants in Kilo.

Based on Resolute’s most recent closing price, the price paid for Osisko’s stake is C$0.11 a Kilo share.

The acquisition of Osisko’s holding in Kilo will increase Resolute’s own shares in the TSX-listed company to 27.4%.

“We are pleased to have increased our stake in Kilo at this exciting time. Kilo is about to commence drilling at a range of untested targets in close proximity to the Adumbi prospect in the Democratic Republic of Congo, which forms part of the Somituri project,” said Resolute MD and CEO John Welborn.

“We see Resolute’s expertise and skill set being a strong match with the ideology and strategy of Kilo’s management and look forward to future exploration results.”

Resolute has started discussions with the Kilo board on possible technical cooperation and how the company can best support Kilo’s operations and ambitions. The gold miner is expected to nominate a nonexecutive director to the Kilo board in due course.

Welborn said that Resolute was seeking to build a portfolio of investment in well run, highly prospective gold exploration assets in regions considered to hold the potential for the development of future Resolute gold mines.

“Kilo is a perfect match for our criteria of existing asset quality, future prospectivity, relative value, and an experienced capable management team primarily focused on gold project exploration and development.”