Brixton Metals (BBB.V) announced last week they entered into a non-binding agreement to acquire 100% of the Thorn property in British Columbia.
Brixton will pay $1.5M in cash and issue 7M shares to Kiska Metals (KSK.V) for a total consideration of $2.9M based on a share price of C$0.20 per Brixton-share.
We think this is an excellent development. The previous option agreement required Brixton to spend 10.9M to get a 65% ownership of Thorn, which is obviously much more expensive than paying 2.9M for 100% of the project. We also think the market will give Brixton a higher valuation because they now own 100% of the deposit, instead of being operator of a Joint Ventured project.
Brixton Metals currently has approximately $2.3M in cash ($750k after closing the deal), so we expect them to raise more money in the near future.
Disclosure: The author holds a long position in Brixton Metals Corp. Please see our disclaimer for current positions.