VANCOUVER – Harmony Gold Corp. (TSXV:H) will acquire a copper mining concession in Zambia from Montauk Mining and Minerals Ltd. under a letter of intent announced Wednesday.
Under the agreement, Harmony would acquire up to 100 per cent ownership of the Kafwego-Mufumbwe property in return for 20 million common shares, US$ 1.2 million cash and completion of a two-stage work program.
Montauk would also receive a 1.5 per cent net smelter return on the property’s production.
Based on Wednesday’s market price, Harmony’s stock would be worth about $ 2 million — equivalent to about 60 per cent of the company current market value.
Assuming the deal is completed and no additional shares are issued by Harmony, Montauk would own or control about 37 per cent of Harmony’s equity.
Harmony shares were at nine cents, up 1.5 cents with about one million traded at the TSX Venture Exchange at mid-afternoon.
Local news from metronews.ca/vancouver
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