Alcyone Resources acquires first US project

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Image credit: flickr User: Gerilla

Alcyone Resources, the Queensland precious metals producer, announced that Platinum Partners, a New York based investment management firm will provide the company with a  A$25 million revolving credit facility.

Image credit: flickr User:  Gerilla
Image credit: flickr User: Gerilla

According to the ASX announcement issued by Alcyone Resources, Platinum Partners will fund the company’s growth by way of value acquisition opportunities in the precious metals space.

The company now plans to build a world-class portfolio of precious metals projects through acquisition and consolidation of high-grade and undervalued precious metals assets from all over the world.

“With our silver mine in Queensland now running at a 1.1 Mtpa nameplate capacity, our plans going forward with Platinum Partners are to build a portfolio of high-value previous metals mining interests,” said Alcyone’s Non-Executive Chairman Paul D’Sylva.

In accordance with the growth strategy, Alcyone will acquire the Red Arrow Mine in Colorado, US, for A$5 million. The mine is Platinum Partners’ precious metals project and the acquisition will be funded by way of A$1 million equity issue with Platinum, completed on execution, and a A$4 million convertible loan note which will be drawn on release and grant of security changes.

“Through the acquisition of the Red Arrow Mine in a renowned mining area of Colorado, we are well placed to add a second world class precious metals project to our portfolio, which has excellent development potential, with high gold and silver concentrations and nearby access to a maintained public road system,” said Mr D’Sylva.

200,000,000 shares at a price of A$0.50 per share, upon the completion with AYN’s existing placement capacity, will be given to Platinum.

The Red Arrow is a gold and silver mine in the La Plata Mining District, Colorado, US, that has produced commercial grade gold and silver ore for years and still has excellent potential for further development.

The location of the mine is described as ideal due to the proximity to excellently-maintained logistical infrastructure.

“The lack of liquidity in the junior resource sector has created a number of high value opportunities for businesses with access to capital. Platinum Partners’ investment into Alcyone of their capital and private assets, positions the Company in a very strong position to exploit these market opportunities,” concluded Mr D’Sylva in the statement.