By: African mining market

Trigon Metals Inc., a Canadian mining company, has entered into a definitive share purchase agreement with Horizon Corporation Limited and Kamino Minerals Limited, under which Horizon will acquire Trigon’s interests in the Kombat Project in Namibia. The all-cash transaction, valued at $24 million, was announced following due diligence and negotiations between the parties. This deal comes at a time when mining sector valuations are drawing increased attention from investors seeking exposure to critical minerals and metals.

The sale encompasses the acquisition of 100% of the shares in Trigon Ontario, 100% of the shares in PNT Financeco Corp., and the intercompany loan owing by PNT to Trigon. The transaction is structured to include eight equal cash instalments, with the first payment due nine months after Trigon shareholders approve the deal, and subsequent payments every three months.

Trigon’s Executive Chairman and CEO, Jed Richardson, stated that the agreement marks a significant step towards securing shareholder approval. Upon a successful vote, Trigon will receive an initial $2 million, with the remainder paid in quarterly instalments of $3 million after nine months. Additionally, the $4 million outstanding loan will be forgiven.

Knowledge Katti, a founding shareholder of Trigon Namibia, expressed his support for the transaction, highlighting Horizon’s mining sector experience and the potential for job creation and economic improvement in the Kombat area.

Prior to the transaction’s closing, Trigon will undergo a reorganization, including the creation of a new wholly owned subsidiary, Trigon Ontario, and the transfer of certain assets and obligations.

The purchase consideration includes $1 for the shares in Trigon Ontario and $23,999,999 for the shares in PNT and the PNT Loan. A production payment of $3.5 million to $13 million is contingent upon the project’s ore production and processing rate, and Trigon will also receive a royalty on copper net smelter returns.

The transaction is subject to customary closing conditions, including approval by Trigon shareholders, the Namibian Competition Commission, consent from Sprott, and approval from the TSX Venture Exchange.

Trigon’s board has received a fairness opinion from Beacon Securities Limited and unanimously recommends that shareholders vote in favor of the transaction.