Titan Minerals has signed an agreement to acquire all of the issued share capital in Andina Resources, which operates projects in Peru, via an off-market takeover bid to re-consolidate ownership of the Torrecillas gold project in Peru.
The acquisition is slated enable Titan to strengthen its market position in Peru.
Titan will offer one fully paid ordinary share to Andina shareholders for every 1.18 Andina shares currently held as part of the agreement.
The combination is expected to result in the formation of a Peru-based gold and base metals exploration and production firm with a significantly enhanced scale.
The proposed acquisition will also give Titan access to the Tulin and Vista gold plants.
Titan Minerals non-executive director Nicholas Rowley said: “By consolidating the Torrecillas Gold Project, Torrecillas gold mine, Tulin Gold Plant and the Vista Plant into one entity, Titan will be uniquely positioned to mill its own ore and retain the ability to process small batches of high-grade ore for artisanal miners.
“Consolidation of the ownership of the Torrecillas gold project will ensure that any future discoveries can be owned by Titan exclusively, with minimal additional capital expenditure, by utilising existing heavy equipment, personnel and senior management.
“In addition, Titan will not require the significant capital investment to build in its own mill facilities due the availability and location of the newly constructed Vista gold plant.”
The acquisition will offer benefits to Titan by eliminating the need to build its own mill facilities, thereby helping the company to realise savings of roughly $4m in capital expenditure.
Furthermore, the development will allow ore from the company’s projects to be transported to the Vista plant for processing.
The Tulin plant is located south of Nasca in Southern Peru. It primarily acquires and processes gold ore from licensed artisanal miners.
The Vista plant is currently under construction and will be situated near the San Santiago and Torrecillas gold projects.
It is expected to complete in the second quarter of this year.
The Vista plant is anticipated to have a nameplate capacity of 200t per day.