Arizona Sonoran Copper (ASCU.TO) has announced it attracted Rio Tinto (RIO) as strategic partner for the flagship Cactus copper project in Arizona. Not only will Rio Tinto subscribe for 6.4 million shares at C$2 per share (for a pro-forma 7.2% stake in Arizona Sonoran), it will also work with Rio Tinto’s Nuton division, which owns proprietary technology related to the copper leaching process. This technology was developed by Rio Tinto and aims to increase the recovery rates and to improve the environmental performance of a copper mine.
As part of the strategic agreement between Rio Tinto and Arizona Sonoran, the partners will work on testing the viability of the technology on the Cactus project to unlock the value of sulphide material using the Nuton technology.
Arizona Sonoran will raise a total of 35M CAD (it initially announced a C$30.5M financing but soon upgraded this number to C$35M due to additional investor interest).. Rio Tinto will subscribe for 6.4 million shares while Tembo will subscribe for just over 3.9 million shares while ASCU is also hoping to sell an additional 7.2 million shares to third parties. And although Tembo is participating in the offering, its stake will decrease from 37.6% to 34.6% (assuming the entire C$35M raise gets completed).
Disclosure: The author has a long position in Arizona Sonoran. Please read our disclaimer.
