Deccan Gold Mines enters into MoU for acquiring stake in Finland Gold Projects

Deccan Gold Mines Limited ("DGML") has entered into a non-binding Memorandum of Understanding (MoU) with Tally Ltd., Guernsey, Channel Islands ("Tally" formerly known as Kolar Gold Ltd) to provide an exclusive period up to and including April 30, 2022 to enable DGML to complete due diligence and commercial negotiations and documentation to acquire Tally's interests in gold projects in Finland.

In October, 2016 Tally and Mineral Exploration Network (Finland) Limited ("MENF") had set up Kalevala Gold Oy, Finland ("Kalevala") as a Joint Venture ("JV") to acquire and explore areas for gold in Central Finland.

Kelavala is the owner of exploration licenses for gold in Archaean greenstone belt of Finland. These licenses cover an area of 23.81 sq kms. Detailed exploration, including drilling and preliminary beneficiation test work has been carried out on one of the licenses, which defined a potentially mineable resorurce. There exists potential to increase the resource base with additional drilling. The company is currently pursuing an application for small scale mining. Tally currently owns 31.5% in Kalevala and further has the right to acquire new shares in Kalevala by injecting USD 1 m (approx) for agreed exploration work programmes to go to a 50% shareholding in Kalevala.

In terms of the above MoU, it is contemplated that subject to satisfactory completion of due diligence, DGML will invest USD 1 m (approx) into Kalevala which would be utilized for development of Kalevala's assets. Further, DGML will also acquire Tally's shareholding in Kalevala through a share swap as a second step to go to 50% in Kalevala. During the due diligence, the parties have agreed to work in good faith to agree a path for DGML to increase ownership of Kalevala into an outright majority position.

DGML's technical team plans to visit Kalevala's gold projects in Finland during April, 2022.

Shares of DECCAN GOLD MINES LTD. was last trading in BSE at Rs. 29.75 as compared to the previous close of Rs. 28.75. The total number of shares traded during the day was 140118 in over 392 trades.

The stock hit an intraday high of Rs. 30.15 and intraday low of 28.75. The net turnover during the day was Rs. 4175911.00.

Source : Equity Bulls

Keywords

DECCANGOLDMINES INE945F01025 Mining MoU Acquisition Finland