Evolution Mining (ASX:EVN) has entered into a binding agreement with Navarre Minerals (ASX:NML) to sell the Mt Carlton gold mine in Queensland for up to $90 million.
The amounts consists of $40 million payable upon the deals completion, comprising a mix of equity and cash. Evolution has agreed to participate in Navarre’s equity raise up to a maximum shareholding of 19.9 per cent (approximately $20 million).
A further $25 million is contingent on gold production milestones from Crush Creek. Then another $25 million in the form of a 5 per cent gold price linked royalty where the average spot gold price is greater than $2,250/oz in a given quarter.
Evolution said it has been consistent with its corporate strategy to continuously upgrade its portfolio and the sale of Mt Carlton aligns with that.
Navarre’s economic interest in Mt Carlton is expected to commence from 1 October this year with the transaction expected to close in December. Evolution plan to provide support to Navarre to ensure a safe and smooth transition of ownership.
“Mt Carlton was Evolution’s first development project and has generated excellent returns for shareholders since it was commissioned in 2013,” said executive chairman Jake Klein.
“We believe now is the time to hand Mt Carlton over to an emerging gold producer who can focus on extending the operation’s mine life. The exposure we have retained will enable Evolution shareholders to benefit from the future success of the operation.”
Shares in Evolution Mining (ASX:EVN) are trading 2.5 per cent higher at $3.71.