Britain’s Hochschild Mining said on Wednesday it had signed a letter of intent to sell its Chile-based Volcan gold project operator Tiernan Gold Corp to Canada’s Railtown Capital.
Hochschild has been facing hurdles in production in its Mara Rosa mine in Brazil, which has significantly affected its production and led to a slash in its annual production forecast.
The deal will be structured as a reverse takeover, with Hochschild set to own about 87% of the combined company, which will be listed on the Toronto Venture Exchange.
Shares of the precious metals miner were up 9.3% at 335.8 pence after the announcement, highest since February 2013.
The company had said in August 2023 it was exploring strategic options for the project.
(By Unnamalai L; Editing by Shreya Biswas)
