SSR Mining to sell San Luis Project in Peru to Highlander Silver Corp
SSR Mining Inc. (NASDAQ/TSX: SSRM, ASX: SSR), a prominent player in the mining sector, has entered into a definitive agreement to sell its San Luis Project to Highlander Silver Corp. (CSE:HSLV) in a significant transaction valued at up to US$42.5 million. This deal underscores the dynamic nature of asset consolidation in the mining industry and reflects SSR Mining’s ongoing portfolio rationalization strategy.
Deal Structure and Financial Terms
The total consideration for the San Luis Project, a greenfield gold and silver development project located in the Ancash Department of Central Peru, comprises US$5 million in upfront cash and up to US$37.5 million in contingent payments. These payments are structured to be paid in cash over time, starting with the initiation of a drilling program at the Project and concluding two years post-commercial production. SSR Mining will retain a 4% net smelter returns (NSR) royalty, half of which can be repurchased by Highlander Silver for US$15 million until construction begins.
SSR Mining San Luis Project Highlander Silver Corp
Closing Conditions and Expected Benefits
Scheduled to close in the first quarter of 2024, the transaction is subject to regulatory approvals and customary closing conditions. The sale is anticipated to be beneficial for SSR Mining on a Net Asset Value (NAV) per share basis, aligning with street consensus estimates. Since 2021, SSR Mining has successfully realized over US$300 million from the sale of non-core assets, emphasizing its commitment to portfolio optimization.
Future Outlook and Industry Impact
The sale of the San Luis Project to Highlander Silver represents a strategic move for both companies, with SSR Mining focusing on core assets and Highlander Silver expanding its portfolio in the lucrative gold and silver market in Peru. This transaction is a significant milestone in the mining sector, demonstrating the ongoing consolidation and strategic realignment in the industry.
As the mining industry continues to evolve, such transactions are pivotal in shaping the future of companies like SSR Mining and Highlander Silver, fostering growth and development in the sector.