Goldrock’s principal asset is the 100% owned Lindero Project located in Salta Province, Argentina. The Lindero Project is an open pit, heap leach gold project with a completed 2016 feasibility study which has been granted the environmental permit necessary for development of the project.
Transaction Highlights:
Acquisition provides for continued expansion of low cost production
Fortuna will be focused on bringing the Lindero project into production by 2018
Potential production of approximately 26.5 Moz of silver equivalent (or approximately 346 koz of gold equivalent) annually by 20181
Pro Forma all-In Sustaining Cost ("AISC") of less than US$10/oz silver equivalent (or approximately US$765/oz gold equivalent)2
Combined company with two operating mines and a development project in three top mining jurisdictions in the Americas
Development of the Lindero project benefits from Fortuna’s financial flexibility through a strong balance sheet, zero net debt, and strong free cash flow generation
Shareholders representing approximately 26% of Goldrock shares have agreed to support the transaction
The combination of Fortuna and Goldrock is expected to expand Fortuna’s already low cost silver equivalent production, and will add an asset with over 10 years of reserve mine life, the ability to add significant free cash flow once constructed, and property and district scale exploration opportunities.
Under the terms of the Arrangement Agreement, each common share of Goldrock (a "Goldrock Share") will be exchanged for 0.1331 (the "Exchange Ratio") of a Fortuna common share (a "Fortuna Share").
Jorge Ganoza, President & CEO of Fortuna, stated: "We are very pleased to bring this transaction forward for our shareholders. Fortuna has remained disciplined in its growth initiatives while building and preserving a robust balance sheet and positioning the Company for the value-creating opportunities that complement our existing portfolio of high-quality assets."
Fortuna is a growth oriented, silver and base metal producer focused on mining opportunities in Latin America. Our primary assets are the Caylloma silver mine in southern Peru and the San Jose silver-gold mine in Mexico.
The Company is selectively pursuing acquisition opportunities throughout the Americas and in select other areas.
Goldrock Mines Corp. is an emerging gold producer focused on the development of its 100% owned Lindero gold deposit located in Salta province, northwestern Argentina.
The company has been granted the primary mining permit by the Salta provincial government allowing the Company to develop the Lindero open pit, heap leach gold mine. The company also has secondary permits in place for process water extraction, road construction, building and electrical permits.
In addition, the company has received formal public declaration of support for the Lindero development by a Salta provincial government decree recognizing Lindero as the priority development project for Salta province. With the HPGR unit delivered into Argentina, the purchase of land in Pocitos, the completion of water supply wells and basic engineering including the preparation of construction bid packages, the company is positioning itself for a smooth transition to full construction.
The focused activity taken by the company to date has significantly de-risked the remaining construction and development schedule deliverables for the project. Average annual gold production is anticipated to average 128,000 ounces over the first three years of production and to average 108,000 ounces during the first nine years.
Total mine life is estimated at over 12 years, with significant exploration potential both at Lindero and the adjacent Arizaro deposit which has the potential to use the planned Lindero infrastructure.
