EBRD supports junior exploration company in FYR Macedonia

By Viktorija Melohina


Equity transaction to help pre-development of Ilovitza copper-gold deposit
 
The European Bank for Reconstruction and Development (EBRD) has entered into a subscription agreement under a non-brokered private placement with Euromax Resources Ltd., a Canadian junior exploration and mining company managing exploration of Ilovitza copper-gold mine located in south-eastern FYR Macedonia (the “Company”).
 
Under the investment terms, the EBRD will subscribe for common shares of the Company, representing approximately 20 per cent minus one share of the Company’s issued and outstanding share capital on an undiluted basis for a total consideration of up to the Canadian dollar equivalent of US$ 5 million. The placement will facilitate the unlocking of the US$ 175 million streaming agreement between Euromax and RGLD AG, a wholly-owned subsidiary of Royal Gold, Inc.
 
The proceeds of the EBRD subscription will be used to finance the preparation of a bankable feasibility study and front-end engineering and design work, a key part of the future development of the Ilovitza copper-gold deposit which has the potential to become the largest greenfield mine development in the Balkans region in 30 years.
 
With this project the EBRD will be promoting best practices in environmental stewardship and social engagement. This will also be the first pre-development project in the region to be financed using streaming, a financing method that is popular in Australia and the Americas in the financing of exploration and development of precious metal projects.
 
“We are proud to be supporting responsible development of mining and exploration in FYR Macedonia and the wider region. This is an important transaction for the EBRD, as it is the first EBRD investment which it is making along a concurrent streaming facility provided by RGLD AG. The value of this project for EBRD extends not only to FYR Macedonia but also to the region,” said EBRD Director, Natural Resources Eric Rasmussen.
 
“The project will help further development of the Macedonia’s economy and at the same time bring innovation. EBRD is proud to be working with new private investors and diversifying market opportunities,” said Anca Ioana Ionescu, EBRD Head of Resident Office for Skopje.
 
“We are delighted to welcome the EBRD onto our register as our shareholder.  The EBRD has a significant presence both in FYR Macedonia and the broader region and their participation, after extensive technical environmental and social due diligence, is a further endorsement of the Ilovitza project. We have been trying to carve out a fairly unique path in the manner in which we are financing the development of Ilovitza, in the face of very challenging equity markets in the junior resource sector. The fact that we have been able to bring on board both Royal Gold and EBRD not only adds significant credibility to our plans, but is also a notable de-risking factor in the development of Ilovitza,” said Euromax President and CEO, Steve Sharpe.
 
The EBRD began investing in the FYR Macedonian economy in 1993. To date it has signed over 90 projects in the country with a net cumulative business volume of more than €1.5 billion.