MOD Resources ha fully acquired the T3 Copper Project. This is after the copper-focused junior company signed binding agreements with Metal Tiger to acquire its 30% stake in the aforementioned project.
The total value of the consideration for the transaction adds up to approximately US $26.6m. The amount is inclusive of certain securities that are to be issued to MTR following the completion of the same. For instance, the firm will receive a 12 month escrow on all shares issued to MTR as a result of the conversion of Options.
Furthermore, the transaction will accrue approximately 14% on a fully diluted basis for MOD shareholders. This is in terms of their respective ownership of the T3 project. Lastly and most importantly, MOD Resources shareholders will receive additional value through several rights.
The said rights may be exercised at MOD Resources’ election. Furthermore, the company may choose to pay for the exercise through any combination. This, according to media reports, allows MOD Resources to determine, whether acquisition of any JV Exploration Assets will be accretive- prior to exercise. This is also inclusive of the form of consideration that will maximize value for its shareholders.
MOD Resources are also able to acquire MTR’s 30% interest in MTR’s JV exploration assets only when said assets have been proven to have development potential. On the other hand, MOD’s 100% held licenses in Botswana are not affected by this transaction including the T1 underground project.
According to MOD Resources MD Julian Hanna, the binding agreement with Metal Tiger has the potential to add significant value for MOD shareholders. This is because it not only consolidates ownership of the very substantial, but also provides a very flexible structure for MOD. These, he divulges, include options to acquire MTR’s interests in any new discoveries that reach the scoping study level within three years.
