G+T is pleased to announce that it advised Ora Banda (ASX: OBM) on its joint venture transaction with Wesfarmers in respect of non-gold mineral rights at the Davyhurst Project.
Ora Banda, a uniquely positioned gold exploration and development company, is the owner of the Davyhurst Gold Project in the highly productive eastern goldfields region of Western Australia.
The transaction involved an agreement with Davyston Exploration Pty Ltd (DEPL), a wholly-owned company in the Wesfarmers Chemicals, Energy & Fertilisers division, acquiring 65% of all non-gold mineral rights held by Ora Banda on the Davyhurst tenement package for $26 million cash consideration and a 2% royalty.
DEPL and Ora Banda will enter into a 65% / 35% joint venture and DEPL has the ability to increase its stake to 80% by sole funding an additional $15 million of exploration expenditure on the Davyhurst tenements over the next 3 years.
The transaction documents also included binding terms for the joint venture (including on commencement of mining), the mineral sharing arrangements and royalty payment terms.
In conjunction with the above, G+T assisted Ora Banda on the effective on-sale of 1.5% of the 2% royalty to be received from DEPL (for non-gold minerals produced under the transaction with DEPL) to Hawke’s Point Holdings L.P. (“Hawke’s Point”) for $4 million (subject to shareholder approval).
Claire Boyd commented: “We are pleased to have advised Ora Banda on this deal and assisted them in unlocking the value in their large land package for minerals that are non-core to Ora Banda.”