Americas Gold & Silver Agrees to Consolidate Idaho Silver Mining JV

By Adriano Marchese

Americas Gold & Silver will acquire the remaining 40% interest in its silver mining project in Idaho, consolidating the joint venture into one business, and said it plans to raise new funds through a private placement.

The Toronto-based miner said Wednesday it has entered into a binding agreement with an affiliate of Eric Sprott and Paul Andre Huet whereby it will acquire the interest in the Galena Complex.

Behind the move to consolidate is the idea that streamlining operational and financial decision making will lead to a more focused vision at Galena centered around optimizing and expanding the operation through better use of existing infrastructure, Americas said.

Once the transaction closes, Huet will be appointed chairman and chief executive officer of while Darren Blasutti will remain as president. Huet brings with him a wealth of experience and a strong record in optimizing underground mines. He was most recently chair and CEO of Karora Resources before it combined with Westgold Resources.

The acquisition will also make Sprott the largest shareholder of the company with a stake of about 22% in the business. Sprott is a Canadian businessman and has been a big player in precious metals investing for decades.

Under the terms of the deal, the owners of Sprott will receive 170 million common shares of Americas, worth about 68 million Canadian dollars ($49.8 million) as well as $10 million in cash. Sprott will also receive 18,500 ounces of silver deliveries every month for the first three years, it said.

Additionally, Americas said it has agreed to complete a bought deal private placement financing to raise C$40 million at an issue price of C$0.40 apiece.

Shares in the company have been sharply higher in the year, rising about 32% since the start of 2024 to close on Tuesday at C$0.44. The stock is still down about 7.5% over the last 52-weeks.

On the financing front, Americas said that its also in advanced discussions with a number of lenders to restructure its balance sheet and expects to enter into exclusive negotiations in the near-term to replace its existing debt facilities.

Write to Adriano Marchese at adriano.marchese@wsj.com

(END) Dow Jones Newswires

October 09, 2024 07:58 ET (11:58 GMT)

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