Capstone Mining Corp. has entered into a definitive share purchase agreement to sell its Kutcho development project to Desert Star Resources Ltd.. Under the terms of the Agreement, Capstone will receive C$28.8 million in cash.
"The divestiture of Kutcho is consistent with our strategy to focus on our core assets," said Darren Pylot, President and Chief Executive Officer of Capstone. "This agreement allows us to retain exposure to the Kutcho project, while strengthening our balance sheet. We look forward to seeing the Kutcho project advance under Desert Star's ownership."
The transaction is subject to financing and other customary closing conditions and is expected to close in the third quarter of 2017. Capstone intends to use net proceeds from the sale primarily to reduce outstanding borrowings under its revolving credit facility.
The Kutcho Project is a high grade copper-zinc development project, located approximately 100 kilometres east of Dease Lake and 330 kilometres north of Smithers in the Liard mining district of north-western British Columbia, Canada.
Capstone Mining Corp. is a Canadian base metals mining company, focused on copper.
