Dreadnought Resources Ltd (ASX:DRE) Divests Projects to Focus on Gold
Dreadnought Resources Ltd (ASX:DRE) has executed a binding sale and purchase agreement with Catalina Resources Ltd (ASX:CTN) to divest the Evanston and Yerilgee Projects. The deal, subject to completion, will provide Dreadnought with $250,000 in cash, 72.5 million shares in Catalina, a $1 million milestone payment, and a 1% net smelter return royalty on specified tenements.
Details of the Transaction
The total consideration for the divestment includes a non-refundable deposit of $25,000 already received, a remaining cash payment of $225,000 upon completion, and the issuance of 72,500,000 fully paid ordinary shares in Catalina, subject to a 12-month escrow period. A milestone payment of $1 million will be triggered if a JORC Inferred Gold Resource exceeds 500,000oz. Completion is anticipated in January 2025, pending regulatory and third-party approvals.
Executive Comments
Dreadnought’s Managing Director, Dean Tuck, stated, “When completed, the divestment of Evanston and Yerilgee will be a win-win for both businesses. Catalina will benefit from a project with significant scale, while Dreadnought will maintain leverage through its shareholding in Catalina, milestone payment, and royalty. This aligns with our strategy to focus on bringing the Star of Mangaroon into production and enhancing our gold exploration pipeline.”
Future Focus
Dreadnought intends to concentrate on gold development at the Star of Mangaroon, aiming to deliver additional mineable ounces and develop high-grade gold targets for exploration in 2025. The divestment underlines Dreadnought’s strategic shift towards becoming a self-funded explorer.
Motley Fool contributor Kiarra Jackson has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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