Arizona Sonoran forms partnership with Rio Tinto
2022-04-28 09:13 ET - News Release
Mr. George Ogilvie reports
ARIZONA SONORAN ANNOUNCES A STRATEGIC INVESTMENT BY RIO TINTO AND NON-BROKERED PRIVATE PLACEMENT FOR AGGREGATE GROSS PROCEEDS OF UP TO C$30.5 MILLION
Arizona Sonoran Copper Company Inc. has entered into a strategic partnership with Rio Tinto focused on Rio Tinto's Nuton venture and a non-brokered private placement for total gross proceeds of up to $30.5-million.
Nuton offers a portfolio of proprietary copper-leach-related technologies and capability developed by Rio Tinto to deliver increased copper recovery and leading environmental performance.
Arizona Sonoran is conducting a structured non-brokered private placement for up to $30.5-million, including Rio Tinto and Tembo Capital Elim Co-Investment LP, where Rio Tinto will subscribe for 6.4 million common shares and Tembo will subscribe for 3,911,916 common shares. An aggregate of up to approximately 15,231,916 Arizona Sonoran common shares will be issued at a price of $2 per common share under the offering. The subscription price represents a 3.4-per-cent discount to the closing price of common shares as at April 27, 2022, and a 1.26-per-cent discount to the five-day volume-weighted average price as at close of April 27, 2022.
Upon completion of the offering in full, Rio Tinto is expected to hold 7.4 per cent of the outstanding share capital of the company, and although participating in the offering, Tembo will reduce its holding from 37.6 per cent to 35.5 per cent in the company.
The common shares issued under the offering will be subject to a statutory hold period under applicable Canadian securities laws, expiring four months and one day from the date of closing.
Cactus is a brownfield copper mine located on private land in western Pinal county, Arizona, that benefits from significant infrastructure, including on-site power and water and ready access to additional infrastructure.
George Ogilvie, president and chief executive officer of Arizona Sonoran, commented: "We are thrilled to introduce Rio Tinto as a key shareholder of ASCU and endorsement of the project's potential by a major industry player. We are also thankful for our continued support from current shareholders, including Tembo in this capital raise. This private placement provides the company with significantly more capital to explore opportunities to deliver scale to the main project, by way of intensive exploration at Parks/Salyer (P/S) and metallurgical testing of the primary chalcopyrite material at Cactus, which is not currently in the preliminary economic assessment (PEA) mine plan."
Clayton Walker, chief operating officer of Rio Tinto Copper, said: "This investment will allow Rio Tinto to work with ASCU to assess the potential for deploying our innovative Nuton copper leaching technologies at Cactus. Nuton provides the opportunity to unlock additional copper and deliver environmental benefits, including a low-carbon footprint and reduced waste."
Use of proceeds and strategic partnership focused on Rio Tinto's Nuton technologies
The company will use the net proceeds from the offering to finance additional drilling, exploration, project and study work related to the company's Cactus mine project, and for general corporate purposes.
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