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- Pacific American Holdings (PAK) has entered into an exclusive and binding term sheet with Salazar Gold
- Under the agreement, Pacific can acquire a 60 per cent interest in Salazar’s WA gold projects
- This would be done via a stage farm-in, with total expenditure of up to $2 million to be spent
- Pacific has also announced its successfully raised $750,000 through a recent capital raise
- At the close of market, PAK is up 25 per cent and shares are trading for 2.5 cents per share
Pacific American Holdings (PAK) has entered into an exclusive and binding term sheet to acquire a 60 per cent interest in Salazar Gold’s WA projects.
Salazar Gold’s projects include the Porphyry North Gold Project in the Yilgarn area, which contains three gold targets.
Agreement
Pacific will acquire the ruling interest through a staged farm-in agreement, which requires a minimum of $2 million being spent on expenditure.
Salazar has already given Pacific a 60-day exclusive option to enter into an agreement, for a cost of $50,000.
If Pacific decides to go ahead with the exclusive option and earn a starter 35 per cent interest in the projects it will need to spend an additional $750,000.
To push its stake to 50 per cent, the company will need to spend a further $500,000, and to earn 60 per cent — Pacific will need to spend another $750,000.
However, for the entire deal to proceed, due diligence will need to be completed at Pacific’s satisfaction.
Speaking on the opportunity, Pacific Chairman, Geoff Hill, said he believes Porphyry North is an exciting gold project.
“Salazar has undertaken detailed preliminary exploration with a number of targets that are drill-ready,” he said.
“This investment in gold, coupled with the company’s most recent venture GP
Hydro, supports Pacific strategy to diversify into high-value assets that have
significant returns for shareholders,” he added.
Placement
Meantime, alongside the acquisition announcement, Pacific also announced it had completed a recently announced capital raise.
The company first entered a trading halt, as it prepared to tap investors for fresh cash, last week.
Since then, the company has successfully raised $750,000, with the new shares on offer priced at 2 cents each.
Pacific plans to use the funds raised to earn an initial 35 per cent interest in Salazar’s gold projects.
On the close of market this afternoon, PAK was up 25 per cent, with shares worth 2.5 cents each.
