(Alliance News) - Lexington Gold Ltd on Monday said its subsidiary has entered into a conditional share subscription and loan agreements to acquire 76% of White Rivers Exploration Proprietary Ltd.
The gold explorer with projects in North and South Carolina said it will pay GBP300,000 through a new loan to WRE, as well as up to GBP6.4 million via the issue of new shares in Lexington Gold, dependent on certain milestones being met.
White Rivers has significant gold assets in South Africa, and is a major tenement holder at Witwatersand gold fields, holding interests covering around 89,499 hectares.
"The Witwatersrand gold fields have been the source of almost a third of the world's gold production since 1886 and are estimated to still hold over one billion ounces," explained Chair Edward Nealon, adding the exploration activities at the tenements have been "extremely encouraging" so far.
The firm said the area has so far produced 2 billion ounces of gold.
Chief Executive Bernard Olivier said: "This proposed acquisition of WRE, with its substantial portfolio of gold assets, represents a tremendous opportunity for Lexington Gold. The projects are all considered shallow level in terms of gold mining in South Africa and the portfolio comprises, in our view, one of the best gold asset packages in the world".
Lexington Gold shares rose 10% to 9.37 pence each in London on Monday afternoon.
By Harvey Dorset, Alliance News reporter
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