Sign In
Last checked at 
1 Jul 2009 07:00
ο»Ώ
July 1, 2009
Hochschild increases stake in Gold Resource Corporation
Hochschild exercises option to invest a further $20 million in GRC
Purchase of 5 million GRC shares at $4 per share, representing a 20% discount to the previous 30 day average closing priceΒ
Hochschild's ownership to increase from 14.6% to 23.9%
Investment provides additional exposure to GRC's high grade, low cost ounces in a mining friendly country with significant mineral potential
Transaction represents continued delivery of cluster consolidation strategy
Hochschild Mining plc ("Hochschild") is pleased to announce that it has exercised its option to purchase a further five million shares of Gold Resource Corporation ("GRC") for a total cash consideration of $20 million,Β representing a 20% discount to the previous 30 day average closing price as at 24 June 2009.Β The purchase will be completed in two tranches: a $5 millionΒ dollarsΒ investment which closed on June 30, 2009 and a second tranche of $15 millionΒ dollars,Β which will close byΒ 20Β July 2009. On completion of the purchase, which will be funded from existing cash, Hochschild will have a 23.9% interest in GRC,Β a US OTC traded underground precious metals miningΒ company with a number of prime development projects in southernΒ Mexico.Β
The investmentΒ increasesΒ Hochschild'sΒ exposureΒ toΒ GRC'sΒ high grade,Β low costΒ ouncesΒ inΒ a mining friendly country with significant mineral potential, and expands the Group'sΒ Southern MexicoΒ operational cluster following Hochschild's initial investment in GRC in December 2008.Β
GRC will use $16 million of the proceeds to complete the El Aguila project.Β El AguilaΒ is currently expected to commence productionΒ in the second half ofΒ 2009 at 70 thousand ounces of gold per yearΒ (4.2 million silver equivalent ounces),Β subject to obtaining remaining permitsΒ andΒ regulatory approval.Β The deposit comprises 75% gold and silver and 25%Β zinc, copper and leadΒ at current prices. The remaining investment will be used toΒ advance GRC's exploration efforts around the La Arista, Margaritas, El Rey and El Aguila properties.
Miguel AramburΓΊ, Chief Executive Officer of Hochschild Mining plc, commented:Β
"We are delighted to announce this transaction which provides Hochschild furtherΒ exposureΒ toΒ low cost,Β high grade ouncesΒ in theΒ Southern Mexico, in line with our cluster consolidation strategy.Β We have been extremely impressed with the quality of GRC's assets and the speed at which the El Aguila property is being developed. This investment will enable GRC to complete the construction of the mine and plant as well as to further their exploration efforts."Β
|
Enquiries: |
|
|
Hochschild Mining plcΒ |
+44 (0)20 7907 2932Β |
|
Finsbury |
|
|
Robin Walker |
+44 (0)20 7251 3801 |
|
PublicΒ Relations |
About Hochschild Mining plc:
Hochschild Mining plc is a leading precious metals company listed on the London Stock Exchange (HOCM.L for Reuters /Β HOC LNΒ for Bloomberg) with a primary focus on the exploration, mining, processing and sale of silver and gold. Hochschild currently operatesΒ fourΒ underground epithermal vein mines,Β threeΒ located in southernΒ Peru,Β one in southernΒ ArgentinaΒ andΒ one open pit mine in northernΒ MexicoΒ andΒ numerousΒ long-term prospects throughout theΒ Americas. Hochschild has over forty years experience in the mining of precious metal epithermal vein deposits.Β For further information please visitΒ www.hochschildmining.com.
About GRC:Β
Gold Resource Corporation is a mining company focused on production and pursuing development of gold and silver projects that feature low operating costs and produce high returns on capital. The Company has 100% interest in four potential high-grade gold and silver properties inΒ Mexico's southern state ofΒ Oaxaca. The company has 42,345,489 shares outstanding and no warrants. ForΒ more information, please visit GRC's website, located atΒ www.Goldresourcecorp.comΒ and read the Company's 10-K for an understanding of the risk factors involved.
Forward looking statements:Β
The statement in this pressΒ releaseΒ relating to the advancement and development ofΒ Gold Resource Corporation'sΒ El AguilaΒ project is a forwardΒ looking statement within the meaning of securities legislation.Β TheΒ statement is based on the public disclosuresΒ ofΒ Gold Resource Corporation, andΒ is subject to theΒ statements byΒ Gold Resource CorporationΒ aboutΒ such forward looking statements and the assumptions and risks associated with it.
Follow the stocks
