An anonymous director of Anconia Resources reports
AVALON INVESTMENT HOLDINGS LTD. AND ANCONIA RESOURCES CORP. ANNOUNCE STRATEGIC INVESTMENT OF US$4.5 MILLION FROM SILVERCORP METALS INC.
Anconia Resources Corp. acquisition target Avalon Investment Holdings Ltd., the holder of an indirect 100-per-cent interest in the Omai gold mine in Guyana, has completed a non-brokered private placement financing for aggregate proceeds of $4.5-million (U.S.). Under the terms of the financing, Avalon issued 30 million common shares of Avalon to a subsidiary of Silvercorp Metals Inc. at a price of 15 U.S. cents per common share. In connection with the financing, Anconia Resources and Silvercorp entered into an investor rights agreement, pursuant to which Silvercorp, as long as it owns at least 10 per cent of the issued and outstanding shares of Anconia, has the rights to: (i) participate in equity financings in order to maintain its pro rata interest in Anconia at the time of any such financing; and (ii) nominate one individual to serve as a director of Anconia.
In a press release dated July 17, 2020, Anconia provided an update in connection with a proposed reverse takeover of Avalon. The proposed transaction is subject to the approval of the TSX Venture Exchange to list the shares of the resulting entity thereon. The resulting issuer will continue to carry on exploration and development, focused primarily on the exploration of Avalon's Omai gold mine project in Guyana.
Mario Stifano, incoming president and chief executive officer of the resulting issuer, commented: "We are very pleased to have received the support of Silvercorp as we continue advancing the Omai gold mine. Omai has historically produced over 3.7 million ounces of gold and has the potential to again become a Tier 1 gold asset in the Americas. With historic unmined intercepts of 12 metres of 23.8 grams per tonne gold, 61 metres of 3.7 grams per tonne gold, 15 metres of 13.6 grams per tonne gold and numerous high-priority exploration targets, Avalon is well positioned to create significant shareholder value on completion of the RTO listing and to commence drilling this year."
Denis Clement, incoming executive director and founder of the resulting issuer, commented: "We are pleased to welcome Silvercorp as a strategic investor. Silvercorp's investment further validates the significant potential of Omai to become the leading gold exploration company in Guyana. With Silvercorp's investment, Avalon is fully financed to complete the RTO listing and to carry out its exploration plans over the coming year."
Upon closing of the proposed transaction, it is anticipated that Silvercorp will own 15.8 per cent of the resulting issuer.
About Silvercorp Metals Inc.
Silvercorp is a profitable Canadian mining company producing silver, lead and zinc metals in concentrates from mines in China. The company's goal is to continuously create healthy returns to shareholders through efficient management; organic growth and the acquisition of profitable projects. Silvercorp balances: profitability; social and environmental relationships; employees' well-being; and sustainable development.
Brian H. Newton, PGeo, is a qualified person, pursuant to the requirements of National Instrument 43-101. He has reviewed and approved the technical information in this press release.
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