Ivanhoe Electric subsidiary Cordoba Minerals has entered a definitive framework agreement with Veritas Resources to sell its 50% stake in the Alacrán copper-gold project in Colombia, along with additional Colombian exploration assets, in a $128m deal.
The transaction will involve the divestment of Cordoba’s wholly owned Colombian subsidiaries, Minerales Cordoba and Exploradora Cordoba, to Veritas Resources, which holds the remaining 50% stake in the project.
Go deeper with GlobalData
Veritas Resources, a subsidiary of JCHX Mining Management, will provide Cordoba with immediate cash proceeds of $88m.
Cordoba will also be eligible for up to an additional $40m in potential deferred and contingent payments.
A success fee will also be paid to Ivanhoe Mines Consulting Services for its advisory role in the transaction.
Cordoba plans to distribute the net proceeds from the sale to its shareholders, retaining $5m for corporate purposes. The distribution is expected to be between $65m and $70m, subject to regulatory approvals and completion of the transaction within the agreed time frame.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalDataThe transaction will result in the termination of previous agreements with JCHX and the repayment of outstanding bridge loan debt.
The closing of the deal is contingent on several approvals, including those from Cordoba shareholders, the TSX Venture Exchange (TSXV) and Colombia’s environmental authority.
Post-transaction, Cordoba will remain a publicly listed company on the TSXV, focusing on its Perseverance property and seeking new business development opportunities. Ivanhoe Electric will continue to be a significant shareholder.
The transaction is classified as a related party transaction, given JCHX’s significant shareholding in Cordoba.
A special committee of independent directors was formed to oversee the transaction process, with Haywood Securities providing a fairness opinion and financial advisory services.
The special committee and the board of directors have unanimously approved the transaction, deeming it in the best interests of Cordoba and fair to its shareholders, excluding JCHX and its affiliates.
Cordoba Minerals president and CEO Sarah Armstrong-Montoya said: “This transaction represents an opportunity to expedite the advancement of the Alacrán Project and will be an excellent outcome for Cordoba shareholders.
“JCHX is a global leader in mine development and operations and brings proven underground mining expertise to the Alacrán Project – one of Colombia’s most advanced copper-gold assets. With a strong track record in delivering large-scale international mining projects on budget and ahead of schedule, JCHX is well-positioned to unlock the full potential of the Alacrán deposit alongside its consortium partners.”
Cordoba Minerals and JCHX Mining Management signed an arrangement to jointly develop the Alacran project in December 2022.
