Cerro Resources and Primero Mining Sign Definitive Agreement for Cerro del Gallo

Cerro Resources (ASX:CJO,TSXV:CJO)  and Primero Mining Corp. (TSX:P, NYSE:PPP) announced that they have entered into a definitive agreement to support Cerro del Gallo gold/silver heap leach mine in Mexico.

As quoted in the press release:

Primero will acquire all issued and outstanding ordinary shares of Cerro by way of a scheme of arrangement (the “Share Arrangement”) under the Australian Corporations Act 2001 (“Act”), at the ratio of 0.023 of a Primero share for each 1 Cerro share.

Cerro Resources Managing Director, Tony McDonald, said:

By undertaking this transaction, Cerro shareholders benefit immediately from Primero’s balance sheet and cash flow, enabling the Cerro del Gallo project to be constructed without external financing. Importantly, this should ensure returns from an operationalised Cerro del Gallo are maximised, while appreciably lowering the combined average operating cost per ounce of the merged group – benefitting all shareholders.

To view the whole press release, click here.