Wesdome Sells Moss Lake Property To Goldshore Resources For $57 Million

Wesdome Mines (TSX: WDO) has elected to monetize its Moss Lake Project located in Ontario. The company this morning announced the sale of the project to that of Goldshore Resources for initial aggregate consideration of $57.0 million.

The arrangement will see the sale of the entire project to Goldshore, including all assets, property and rights owned by Wesdome in connection with the project. The company however will remain significantly exposed to the asset via equity ownership in Goldshore.

Under the terms of teh transaction, Wesdome is to receive $12.5 million in cash upon closing, as well as shares in an amount equal to the greater of $19.5 million or 30% of the issued and outstanding shares of Goldshore. The company is also to receive $20 million in shares in Goldshore upon certain milestones, including $5.0 million within 12 months of closing, $7.5 million upon the earlier of a PEA being completed or 30 months from closing, and a final $7.5 million upon the completion of a feasibility study, a development decision, or 48 months from closing.

A 1.00% NSR royalty on all metal production from the property has also been granted on the property, which can be repurchased for $5 million within 30 months of the date from closing. The price of the NSR buyback then goes up to $7.5 million until 48 months, after which the option to repurchase the NSR expires.

Wesdome is to also appoint two directors for Goldshore’s board, with Chief Governance Officer Heather Laxton and VP, Exploration Michael Michaud taking the roles.

The transaction is subject to a number of closing conditions, which includes Goldshore completing the reverse takeover of Sierra Madre Developments, which will see the company listed on the TSX Venture.

The transaction is anticipated to close in early Q2 2021.

Wesdome Gold mines last traded at $9.12 on the TSX.

Information for this briefing was found via Sedar and Wesdome Gold Mines. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.