International Goldfields Ltd. (ASX:IGS) announced that it will merge with Santa Fe Gold Corp. (OTCBB:SFEG) to create a company focused on producing, developing and exploring for gold and silver. As part of the merger, International Goldfields will advance AU$2 million to Santa Fe within five business days and will pay the company an additional AU$2 million by October 31, 2012.

According to the press release, highlights of the transaction include:

The proposed merged entity will be a diversified, well-funded and low cost gold-silver explorer, developer and miner, listed on the ASX and also traded on a major US exchange or on the OTC Bulletin Board, with projects located in emerging mining districts including West Africa, Brazil and the south-west US.
The combined entity will have an initial market capitalisation of approximately A$70 million, cash reserves of at least A$10 million, low cost gold & silver production of 28,000 oz pa (gold equivalent), an operating mill, near term development assets and a portfolio of advanced exploration assets.

Click here to read the full International Goldfields Ltd. (ASX:IGS) press release.

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