Newcrest Mining, Greatland Gold's (LON: GGP) joint venture partner in the Havieron copper-gold project, is exercising an option to acquire an additional 5% in the project at fair market value as part of the Joint Venture agreement, the companies said Tuesday.
Greatland Gold, the mining development and exploration company, told investors that Newcrest issued a notice stating it would like to begin the process under the agreement to seek to agree on the option exercise price in the period to mid-February 2022.
Greatland Gold shares are up 14% to 14.4p following the news.
While fair market value has yet to be determined by the companies, once it is, Newcrest has 30 business days to exercise its option to acquire the additional 5% interest.
The money raised will first be used to repay the outstanding balance under the existing Newcrest loan facility, stated Greatland.
Newcrest is entitled to an additional 10% joint venture interest. If they exercise the entitlement, it will result in an overall joint venture interest of 70% for Newcrest (30% Greatland). If the 10% and 5% options are exercised, Newcrest's interest will be 75%.
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Sam is a professional trader and the lead stock market news writer at AskTraders. After starting his career in the forex market, Sam now focuses on gold and stocks with a preference for fundamental and macroeconomic analysis.