oxr acquires gold grove

I have been suggesting that today would be a asx news day for Oxiana in which we experience aTurning Point in price.

Here is today's news...

OXIANA TO ACQUIRE GOLDEN GROVE BASE AND PRECIOUS METALS OPERATION
Oxiana Limited entered an agreement today to acquire the Golden Grove base and precious metals operation in Western Australia, from Newmont Mining Corporation for A$265 million, effective 1 July 2005.
Golden Grove is a world class massive sulphide base and precious metals operation with strong cashflow and excellent near-mine and regional exploration potential. Golden Grove is a major producer of zinc, copper, lead, gold and silver and has a production cash cost in the bottom third of world cash costs for zinc operations.
The transaction represents another significant move by Oxiana in its objective to continue to grow shareholder value and fill the void created in Australia by the global resource consolidation. Importantly the acquisition:
• diversifies Oxiana’s geographic and commodity exposure;
• complements Oxiana’s existing asset portfolio with a further world class asset;
• provides an operating asset with strong, accretive earnings and cashflow;
• adds valuable human resources to the Oxiana team to support Oxiana’s operations and development projects; and
• provides potential commercial synergies with Prominent Hill.
Key Features of Golden Grove
• Golden Grove is located in Western Australia, approximately 350 km north east of Perth, in close proximity to the port of Geraldton and grid power infrastructure.
• The assets include Gossan Hill, a copper-zinc-gold-silver underground mine, the Scuddles zinc-copper underground mine, a 1.3 million tpa treatment plant and a surrounding tenement package.

OXIANA TO ACQUIRE GOLDEN GROVE BASE AND PRECIOUS METALS OPERATION
Oxiana Limited entered an agreement today to acquire the Golden Grove base and precious metals operation in Western Australia, from Newmont Mining Corporation for A$265 million, effective 1 July 2005.
Golden Grove is a world class massive sulphide base and precious metals operation with strong cashflow and excellent near-mine and regional exploration potential. Golden Grove is a major producer of zinc, copper, lead, gold and silver and has a production cash cost in the bottom third of world cash costs for zinc operations.
The transaction represents another significant move by Oxiana in its objective to continue to grow shareholder value and fill the void created in Australia by the global resource consolidation. Importantly the acquisition:
• diversifies Oxiana’s geographic and commodity exposure;
• complements Oxiana’s existing asset portfolio with a further world class asset;
• provides an operating asset with strong, accretive earnings and cashflow;
• adds valuable human resources to the Oxiana team to support Oxiana’s operations and development projects; and
• provides potential commercial synergies with Prominent Hill.
Key Features of Golden Grove
• Golden Grove is located in Western Australia, approximately 350 km north east of Perth, in close proximity to the port of Geraldton and grid power infrastructure.
• The assets include Gossan Hill, a copper-zinc-gold-silver underground mine, the Scuddles zinc-copper underground mine, a 1.3 million tpa treatment plant and a surrounding tenement package.
Funding
Oxiana will fund the cash component from a A$175 million acquisition facility to be provided by ANZ and from internal resources. The twelve month ANZ acquisition facility allows a comfortable period of time to arrange appropriate, longer term funding.
The share component represents the issue of 81.5 million Oxiana shares and results in Newmont holding approximately 6.0% of Oxiana. Newmont has agreed to a 6 month escrow.
Gryphon Partners is acting as financial adviser to Oxiana in relation to this acquisition.
Owen L Hegarty