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Metalla Royalty and Streaming to add producing royalty; announces private placement

Last updated: 15:43 11 Dec 2018 EST, First published: 15:16 11 Dec 2018 EST

gold
Metalla is a precious metals royalty and streaming company

Metalla Royalty and Streaming Ltd (CVE:MTA) announced Tuesday it has entered into an agreement to acquire a 1.5% net smelter return royalty for US$1.5 million in cash from Patagonia Gold SA. 

The company said the royalty is connected to certain mining rights located at the Cap-Oeste Sur East (COSE) property, which is located in the province of Santa Cruz, Argentina. It includes a net smelter return on all products mined from the property. 

READ: Metalla Royalty encouraged by drill results in Saint Gertrudis mine

The Cap-Oeste Sur East property is a gold and silver project that is 100%-owned by Minera Triton Argentina SA, a wholly owned subsidiary of Pan American Silver Corp (NASDAQ:PAAS) (TSE:PAAS).

"Metalla is pleased to add another producing royalty on a high-grade deposit with proven operator Pan American Silver. This acquisition consolidates royalties on two separate properties (COSE and previously acquired Joaquin) that represents all of the future growth at Pan American Silver's Manantial Espejo mine complex," said Brett Heath, president and CEO of Metalla. 

"The royalty complements our existing portfolio, will increase our cash flow, and will further enhance our strong growth profile. This is consistent with our long-stated strategy of acquiring existing royalties on quality assets with tier-one operators."

Private placement offering

The company also announced it plans to offer a private placement, with an aim to raise up to C$3 million. It said up to 3,846,153 units of the company will be offered at a price of C$0.78 per unit.

Funds raised will be used to finance the royalty transaction and other royalty and stream acquisitions. 

Each unit will consist of one common share and one-half of one common share purchase warrant. Each warrant will entitle the holder the opportunity to acquire one common share of the company at a price of C$1.17 for a period of 24 months from the closing of the offering. 

Shares of Metalla were at C$0.81 on Tuesday.

 

Contact Katie Lewis at katie@proactiveinvestors.com

Follow her on Twitter: @kelewis

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