AGD has been buying up TRYs stake in Casposo since 2016 from 51% to 70% with the option to acquire the lot in 3 years -
http://clients.weblink.com.au/news/pdf2/01836247.pdf
Austral Gold Limited (‘Austral’ or ‘the Company’) (ASX: AGD; TSXV: AGLD) is pleased to announce that the Company has paid US$1 million to Troy Resources Limited (‘Troy’) (ASX: TRY) to acquire an additional 19% interest in the Casposo silver-gold mine located in San Juan, Argentina (‘Casposo’). Following Austral acquiring operatorship through an agreement entered into with Troy in March 2016, Austral recommissioned the mine and plant and commenced full operations in November 2016.
Under the agreement between Austral and Troy signed in March 2016, Austral paid US$1 million for 51% operatorship and undertook to fund up to US$10 million in studies and CAPEX to recommission the mine. Austral was entitled to acquire a further 19% of Casposo by paying US$1 million. Troy was also entitled to receive US$2 million in deferred payments, with US$1 million paid in September 2016 and the remaining US$1 million being the Deferred Payment. Austral still has options to acquire the remaining 30% as follows:
10% for US$1,500,000 in December 2018;
10% for US$2,500,000 in December 2019;
10% for US$3,000,000 in December 2020.
The exercise price of each option is subject to adjustment if the price of silver is at US$16/oz Ag or greater.
This sale was a massive bargain for AGD.
lets compare AGD v TRY Q3 results -
annual production 49kozpa v 70-85kozpa
Q3 production 18122 v 21703
Q3 aisc U$1151 v U$720
AVRP 1132 v 1328
Q3 revenues U30.2M v $30.6M
cash at bank $3.3M v $3.8M
total debt U$25M v U$16M
Mcap $53M v $73M
AGD has less production at higher costs double the debt at much higher valuation.
On AGD MC, TRY ought to be at a MC of $95M or 21c ps
Both are way undervalued, If AGD is cheap then TRY is even more cheaper!
