Impact Silver has concluded the acquisition of Consolidated Zinc’s high-grade Plomosas zinc-lead-silver mine in Chihuahua, Mexico, in a cash-stock deal worth $6m.
According to the share purchase and sale agreement, which was announced in February 2023, Impact Silver has acquired Consolidated Zinc’s Mexican subsidiary Minera Latin America Zinc (MLAZ), which owns a 100% interest in the Plomosas mine.
In exchange, Impact Silver has made an initial cash payment of $2.271m while the balance of a $0.73m cash payment will be made to Consolidated Zinc in 40 business days.
Impact will also issue 11,441,647 of its shares, worth up to $3m, to Consolidated Zinc.
Furthermore, Consolidated Zinc will receive 12% of the net profits, in cash, generated from the project.
Impact said in a statement: “Closing of this acquisition solidifies Impact’s position as one of Mexico’s most well-funded and growth-minded intermediate miners – one that is well-positioned to offer investors high-grade production, balanced and aggressive growth, and exciting exploration upside going forward.”
Impact said the transaction expands its production profile from one to two producing operations in Mexico.
The firm is planning to undertake a drill programme to both infill the Plomosas resource and test extensions of known mineralisation at the Plomosas mine in 2023.
Impact Silver chairman and CEO Frederick Davidson said: “Plomosas is a unique and fully permitted operation built on a large mineral system with global tier-one historic grades at 13%+ zinc providing the exceptional potential to both upgrade and expand its current level of operations.”
Proceeds from the sale will be used by Consolidated Zinc to accelerate its exploration work at its Pilbara and Gascoyne Projects in Western Australia.
Between 1945 and 1974, the Plomosas project extracted more than two million tonnes of ore grading 22% Zn+Pb and over 80g/t Ag.
Consolidated Zinc started zinc production at the 3,000ha project in 2018.