Barisan Gold Corporation has entered into a preliminary agreement with a prominent Indonesian group to jointly advance Barisan’s Indonesian properties. Under the terms of the agreement, the Indonesian group will take an 80% equity interest in both of Barisan’s Indonesian subsidiaries.

Barisan Gold’s remaining 20% equity interest will be fully carried by the new partner until the issuance of a mining licence at the company’s project(s) in Indonesia.

It will become the Indonesian group’s sole responsibility to carry exploration activities, feasibility study activities and permitting activities required prior to the application and successful issuance of a mining licence. Upon the issuance of the licence, Barisan will have the option to either fund its 20% share or be further diluted to 5%, in which case its 5% equity interest will become free carried.

The new partner is a well-established Indonesian conglomerate with operations in real estate and agriculture amongst others. They are fully-financed and have a strong team on hand that will combine with Barisan’s current Indonesian staff to carry our Indonesian projects through the next phase of permitting, exploration and feasibility studies.

The new partner has already advanced significant capital to Barisan’s Indonesian subsidiaries in order for them to carry-on permitting activities ahead of restarting operations.

“It is with great excitement that we announce this partnership,” said Barisan Gold’s CEO Alex Granger. “This deal secures Barisan a direct path to production at its world-class Indonesian mining projects.

“In the current climate, owning a significant equity interest in a world-class mining project whereby you do not have to contribute anything financially is of great value. That, combined with attracting a strong local partner which removes any risks associated with operating in a challenging country, is of equal importance.”

The benefits to Barisan Gold include:
• Removal of Indonesian political risk through the association with a strong prominent Indonesian group that is well connected in-country and has decades of experience handling government permitting processes;
• Removal of financing risk as Barisan Gold’s remaining 20% equity interest is fully financed by the new partner;
• Immediate restart of operations in Indonesia; and
• Exponential value accretion to Barisan Gold shareholders versus self-financing the development of our mineral projects at in current market environment.

“Barisan Gold has been canvasing the market for almost 12 months seeking financial solutions for the advancement of its high-quality Indonesian assets,” continued Alex Granger.

“Of all the alternatives identified during this process, we believe this transaction represents the best value for our shareholders. The transaction represents a significant premium to the implied value of the Indonesian assets as reflected in the current share price of Barisan Gold.”

In order to fund its share of expenses prior to the closing of the transaction, Barisan will be raising a non-brokered private placement of approximately Can$500,000. Certain directors and officers have committed to purchase a significant portion of the private placement, which is likely to be the final opportunity for investors to participate in a private placement ahead of the issuance of our mining licences some years down the road.

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