Morning Star20 Dec 2018 11:09
LONDON (Alliance News) - Shares in Panthera Resources PLC more than doubled in value on Thursday as it agreed a partnership with Galactic Gold Mines Pvt Ltd for the Bhukia project in India.
Panthera also noted the outcome of state elections in Rajasthan, which it believes will have a positive impact on the licence application for its joint venture partner, MMI Indian Pvt Ltd.
Shares in the gold exploration company more than doubled to 3.67 pence early Thursday, have closed at 1.30p on Wednesday.
Following technical and legal due diligence, Galactic Gold Mines has agreed to acquire a 10% stake in Panthera's subsidiary Indo Gold Pty Ltd for USD1.3 million.
Galactic can acquire an additional 12% stake by providing legal, permitting, and technical support for the Bhukia joint venture, conditional on milestones being met leading to the start of mining at the project.
Following this, Galactic earn additional equity in Indo Gold by providing drilling and logistic services on the restarting of exploration at Bhukia.
Finally, Indo Gold and Galactic will work to negotiate participation in Galactic's listing process to the Bombay Stock Exchange, possibly through a merger of both companies.
Turning to Rajasthan's elections, Panthera said the change of government would have a positive effect on processing the prospective licence application for its joint venture partner MMI.
The company plans to start dialogue with the newly appointed Secretary & Minister for Mines, with its first hearing in the High Court scheduled for January 11.
"With the signing of this term sheet Panthera has taken a big step forward in achieving many of its key strategic and corporate objectives in India. The transaction brings Indian capital to support the development of Bhukia, it provides key corporate, bureaucratic, technical and administrative capabilities in India, and allows IGL an opportunity to participate in Galaxy's BSE listing process, which is planned to commence next year," said Managing Director Geoff Stanley.