Sanatana Resources Inc (CVE:STA) has announced that IAMGOLD Corporation (TSE:IMG) (NYSE:IAG) has waived its right of first refusal in connection with the previously-announced sale of its Watershed Royalty to Ely Gold Royalties Inc (CVE:ELY) (OTCQX:ELYGF).
The Watershed assets surround IAMGOLD’s Coté gold project in Ontario.
Sanatana recently said it had signed a definitive agreement to sell the Watershed Royalty to Ely Gold for C$2.5 million in cash and one million Ely Gold warrants, which will have a five-year term and an exercise price of C$1.31 a share. Ely has the right to accelerate the Ely warrants if the 10-day volume-weighted average price of Ely shares exceeds C$1.97 per share.
The receipt of the waiver from IAMGOLD was a key condition for completion of the royalty sale, which is now expected to close in early December 2020.
Sanatana expects the transaction to significantly improve its liquidity and will allow it to accelerate exploration of its property portfolio and potentially acquire additional projects.
The company owns the 2,200 hectare Gold Rush project near Timmins, Ontario, just 11 kilometres (km) north-west of Pan American Silver’s Timmins West mine where over 750,000 ounces of gold have been produced to date. The company also owns the Tirua copper-gold project, which encompasses 282 square kilometres in the Solomon Islands north of Australia and includes a prospecting licence over 16km, in addition to the Santoy project on the northern shores of Lake Superior.
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