PERTH (miningweekly.com) – Canada’s Newrange Gold Corp has entered into a binding scheme of arrangement to acquire ASX-listed Mithril Resources under a reverse takeover offer (RTO).

The Canadian explorer is offering 18.08 of its own shares for every 1 000 Mithril shares held and will issue a total of over 60.9-million shares under the transaction, at a deemed price of C$0.18 each.

The company is also offering 18.08 warrants for every 1 000 Mithril options held, for a total of 3.16-million warrants, exercisable at C$0.77 each and 3.87-million warrants exercisable at C$0.36 each.

The offer implies a value of A$11.8-million to Mithril.

The Mithril board has unanimously recommended that shareholders accept the offer, in the absence of a superior bid and subject to an independent director finding that the scheme is in the best interest of shareholders.

“The scheme announced today is an important step in the process to place Mithril’s high-grade Copalquin gold/silver property in a market where there is considerable experience and understanding of the globally significant Mexican minerals industry,” said Mithril CEO and MD John Skeet.

“The new Americas-focussed exploration and development company resulting from the merger with TSX-V-listed Newrange creates a highly experienced and focused board and management who are well positioned to take advantage of the considerable growth opportunities at the Copalquin mining district and the two Canadian Red Lake District properties. In both jurisdictions, the new company will be among numerous other Canadian listed companies active in these prolific mining regions where the properties are located. The merger and resulting financing, will provide funds to appropriately advance the properties to increase shareholder value.

“The Mithril board is very pleased to be working with the Newrange board and extremely proud of the hard work and achievements of Mithril’s Mexico team and the significant progress made in advancing the Copalquin project to its current exploration and pre-development stages across the Copalquin district.”

Newrange president and CEO Robert Archer said the Canadian firm was pleased to have entered into the definitive agreement, saying the merger represented a new beginning for Newrange shareholders.

“Not only does the Copalquin gold/silver project bring tremendous value and upside potential but the combined experience of the new management team and board will provide a strong foundation for future growth in the Americas.

“Exploration and development in the prolific Red Lake district of Ontario is still active and we intend to capitalize on that with further work on our Argosy gold mine and North Birch projects. Having projects in two leading mining jurisdictions such as Mexico and Canada provides diversity and lowers the risk for shareholders while increasing the discovery potential.

“We look forward to completing the RTO process and rebranding the company for a fresh start at a time when precious metal prices are on the rise,” said Archer.

The scheme implementation deed is subject to a number of conditions, including the completion of due diligence, an independent expert concluding it is in the best interest of Mithril shareholders, all necessary regulatory, government and court approvals, shareholder approval and Newrange completing a C$3.6-million capital raise to fund further exploration at the Copalquin project.