Alicanto Minerals (ASX:AQI) and Westgold Resources (ASX:WGX) have entered a binding asset sale agreement for the latter to divest the Mt Henry-Selene Gold Project, located near Norseman in Western Australia, for $64.6 million.
Westgold will receive $15 million in cash, including $1 million payable on completion of Alicanto’s capital raising as well as $14 million upon completion of the transaction. Another $19.6 million will be allocated via the issue of shares, held at a share price of $0.055, after completion of the raise.
Alicanto will also issue 90.9 million performance rights after completing 20,000m of drilling at Mt Henry, valued at $5 million; 181.8 million rights after announcing a resource estimate of at least 2 million ounces in inferred or high classification and a minimum grade of 0.5 grams per tonne gold, valued at $10 million; and 272.7 million rights after a positive final investment decision, valued at $15 million.
Performance rights will expire after 5 years and are eligible to be settled in cash if the milestone is achieved prior to the expiry date if elected by Alicanto.
Alicanto will be required to raise at least $25 million as a key condition of this agreement. The company has received firm commitments to raise $28 million.
Alicanto will issue 509.1 million shares at $0.055 per share, representing a 15.4% discount to the last trading price and a 7.2% discount to the five-day volume weighted average price.
Canaccord Genuity and Argonaut Securities have been appointed as joint lead managers and bookrunners for this placement, with Euroz Hartleys acting as co-manager.
Alicanto Executive Chairman Ray Shorrocks says the Mt Henry acquisition is an “exceptional” opportunity for the company.
“It provides immediate scale, a high-quality, near-surface resource, and a clear platform for rapid growth and development,” Shorrocks says.
“The 900,000 ounce resource and pit shells were calculated when the gold price was one-quarter of its current level and the historic drilling data shows most holes ended in mineralisation.
“Given the wide-open nature of the mineralisation and the huge increase in the gold price, the upside at Mt Henry is immense on every level.
“We will waste no time in unlocking this potential, with a 50,000m drilling program already scheduled to start in the first quarter of 2026.”
Westgold CEO Wayne Bramwell says the divestment follows on from the spin-out of the company’s non-core Murchison projects to Valiant Gold.
“This transaction delivers Westgold shareholders an attractive mix of cash, exposure to project upside via a large strategic shareholding, and deferred consideration payable on specific project milestones,” Bramwell says.
“Westgold is pleased to partner with Alicanto, whose board and management team are experienced and committed explorers and have a demonstrable record of rapidly advancing gold projects.
“Alicanto’s planned drilling investment provides a pathway for exploration success and potential future development, which can unlock additional value for all stakeholders.
“Westgold continues to progress discussion in relation to the potential sale of its Peak Hill and Chalice gold assets following strong inbound interest.”
Alicanto Minerals is an emerging gold company focused on advancing the Mt Henry Gold Project in Western Australia.
Write to Maddison Elliott at Mining.com.au
Images: Alicanto Minerals
