Angkor Gold Corp. (
TSX: V.ANK,
Stock Forum) has entered into a strategic alliance with Hong Kong-based Tohui Beishan Property Group Holding Ltd. (TG) that could provide up to $10.5 million for exploration in Cambodia, Angkor said Monday.
The strategic alliance between Angkor and TG includes TG’s ability to acquire up to 15.8 million shares of Angkor and up to 15% of the share capital of its wholly-owned Cambodian subsidiary, Angkor Gold Cambodia over the next 12 months.
Angkor said TG brings to the alliance a consortium of associates, including Beijing Eplo-Tech Engineering Co. Ltd. (BETEC) and the China Chemical Geology and Mine Bureau Shandong Geological Prospecting Institute.
Terms of the alliance include the following:
The private placement by TG of $2.25 million for 79 million units of Angkor, each consisting of one common share at 28.5 cents a share and one non-transferable warrant.
The issuance to TG of an option to purchase 15% of the shares of Angkor Gold Cambodia at $4.2 million until June 30, 2015.
TG will be entitled to a seat on the board of Angkor upon closing of the transaction.
TG will also be entitled to a seat on the board of Angkor Gold Cambodia upon closing of the Angkor Gold option.
Angkor said 80% of the proceeds will be used to fund exploration activities in Cambodia, where the junior has seven exploration licenses covering 1,448 kilometres.
“We have been working on this transaction since last fall and are thrilled to have China’s best exploration expertise available to fast-track our projects,’’ said Angkor Chief Executive Officer
Mike Weeks in a press release. He said the alliance is a clear indication that Cambodia is a ‘country play.’
Angkor shares rose 5% to 32 cents Monday, leaving a market cap of $25.4 million, based on 79.5 million shares outstanding. The 52-week range is 43 cents and 27 cents.