Asante Gold (CSE: ASE) announced on Thursday it has made a $5 million strategic investment into fellow West African gold explorer Roscan Gold (TSXV: ROS), which holds a significant land position in a gold prospective area of West Mali.
Roscan’s primary asset is the Kandiolé project, located east of B2Gold’s Fekola mine and IAMGOLD’s Boto and Diakha deposits, and north of the IAMGOLD Siribaya deposit.
“Roscan’s 100% owned Kandiole gold project in West Mali is located in one of the most prolific and productive gold jurisdictions in Africa,” Douglas MacQuarrie, president and CEO of Asante, said in a news release. “Results to date show a high potential to define a substantial gold mineral resource.”
Asante currently operates in Ghana, where it is developing as many as six projects, including the recently acquired Bibiani gold mine, which has past production of 4Moz, and the Kubi gold mine adjoining AngloGold’s Obuasi mine to the south.
Under a binding term sheet, Asante has agreed to subscribe for and purchase 22.1 million of Roscan’s common shares at C$0.29 per share, for a total investment of C$6.4 million ($5 million).
“The investment by Asante introduces a rapidly growing partner with solid African-based assets and strong connections with alternative pools of capital to help us unlock value on our highly prospective 401.8 sqkm land package,” said Roscan president and CEO Nana Sangmuah.
“Proceeds will be used to fund Roscan’s ongoing exploration program towards developing maiden resources on multiple high-potential targets,” he added.
Roscan’s shares surged 5.9% by 12:10 p.m. EDT following the Asante investment, giving the company a market value of C$87.1 million.