TORONTO - AEX Gold Inc. (AIM: AEXG; TSXV: AEX), an independent mining company with an unrivalled land package of gold and Strategic Mineral assets covering an area of 7,615.85km2 in Southern Greenland, is pleased to announce after over a year of discussions that it has now signed a non-binding heads of terms with ACAM LP to establish a special purpose vehicle and create a joint venture for the exploration and development of its Strategic Mineral assets for a combined contribution of GBP36.7 million.
Subject to negotiation of the final terms of the JV, ACAM will invest GBP18.0 million (circa C$28.5 million) in exchange for a 49% shareholding in the SPV, with AEX holding 51%. AEX is expected to contribute its Strategic non-precious Mineral (i.e. non-gold) licences as well as a contribution in kind, valued, in aggregate, at GBP18.7 million (circa C$29.5 million) in the form of site support, logistics and overhead costs associated with utilizing its existing infrastructure in Southern Greenland to support the JV's activities. An option for further future funding of GBP10.0 million is to be available on the achievement of agreed milestones.
Highlights
ACAM LP is a natural resource focused Limited Partnership advised by S and F Investment Advisors Limited (S&F). Louis Bacon, founder of Moore Strategic Ventures and Tim Leslie, the founder of S&F are, indirectly, the beneficial owners of the majority of ACAM LP.
Initial equity funding of GBP18.0 million (circa C$28.5 million) will be provided by ACAM to the SPV directly upon closing of the joint venture agreement to be negotiated and entered into in respect of the JV ('JV Agreement'). Closing of the JV Agreement will be conditional upon, inter alia, the transfer to the SPV of those of AEX's licences which are the subject of the JV, and the approval of such transfers by the Government of Greenland and the Greenland Tax Agency.
The funding provided to the SPV from ACAM will aid in progressing the exploration for and identification of strategic (non-precious) minerals across a number of AEX's existing prospective gold targets including Sava and North Sava, Stendalen, Paatusoq, Kobberminebugt and any other future strategic mineral discoveries made on AEX's licences.
AEX will have managerial and operational control of the JV and the planned exploration programme that will be subject to approval of the JV Management Committee.
All of AEX's gold assets are excluded from the JV and will remain 100% owned by AEX.
Subject to the achievement of certain milestones that will be stipulated in the JV Agreement, the parties have agreed to a further potential pro-rata funding of GBP10.0 million (circa C$16.0 million), at a pre-money valuation of GBP48.4 million ('Subsequent Funding'). Any pro-rated Subsequent Funding will not increase ACAM's participating interest above 49%, provided that AEX contributes its pro rata share of such funding.
The objective of both JV parties is to accelerate the exploration of AEX's existing assets for Strategic Minerals that are in short supply globally, in high demand and vital for the global energy transition.
The execution of definitive documentation is subject, inter alia, to the above conditions and there can be no certainty that the JV will ultimately be formed
Eldur Olafsson, CEO of AEX Gold, commented 'We are delighted to announce our planned partnership with ACAM LP specifically for the funding of our non-precious metal Strategic Mineral assets across our licence areas. This JV will enable us to invest the capital required to bring these strategic mineral targets up the value curve towards future production and also enable us to explore the wider area to identify further non-precious strategic mineral assets. The investment AEX has made in its management team, camp, infrastructure, logistics support and local relationships gives us the ability to deliver on this exciting, ambitious and high potential value work programme. 'The western world is in short supply of strategic minerals, such as copper, zinc, nickel, rare earths and graphite, to power the energy transition, with recent geo-political events putting security of supply into sharp focus. Southern Greenland is one of the few remaining under-explored frontiers for these vital minerals. Our exploration work so far has given us confidence that South Greenland has the potential to host world-class deposits of Strategic Minerals. 'Starting with this investment by ACAM of GBP18 million for a 49% stake in these strategic mineral assets, this deal puts a concrete initial value on the non-precious mineral assets in our portfolio for the first time. To reflect the broader mineral potential in AEX's portfolio, we will be changing the Company's name to Amaroq Minerals Limited in the near future.'
Contact:
Eldur Olafsson
Tel: +354 665 2003
Email: eo@aexgold.com
About AEX
AEX's principal business objectives are the identification, acquisition, exploration and development of gold and Strategic Mineral properties in Greenland. The Corporation's principal asset is a 100% interest in the Nalunaq Project, an advanced exploration stage property with an exploitation licence including the previously operating Nalunaq gold mine. The Corporation has a portfolio of gold and Strategic Mineral assets covering 7,615.85km2 , the largest mineral portfolio in Southern Greenland covering the two known gold belts in the region. AEX is incorporated under the Canada Business Corporations Act and wholly owns Nalunaq A/S, incorporated under the Greenland Public Companies Act.
Forward-Looking Information
This press release contains forward-looking information within the meaning of applicable securities legislation, which reflects the Corporation's current expectations regarding future events and the future growth of the Corporation's business. In this press release there is forward-looking information based on a number of assumptions and subject to a number of risks and uncertainties, many of which are beyond the Corporation's control, that could cause actual results and events to differ materially from those that are disclosed in or implied by such forward-looking information. Such risks and uncertainties include but are not limited to the factors discussed under 'Risk Factors' in the Final Prospectus available under the Corporation's profile on SEDAR at www.sedar.com. Any forward-looking information included in this press release is based only on information currently available to the Corporation and speaks only as of the date on which it is made.
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