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MSA: Expanding Footprint in Colombia Through Exploration Acquisition

What you need to know:
• MSA is acquiring 100% of a large gold exploration project in Tolima, Colombia, from AngloGold Ashanti for $10M cash plus up to $60M contingent payments.
• The project hosts a historical resource of 23.3Moz Au Indicated and 5.0Moz Au Inferred, strengthening MSA’s project pipeline in Colombia, where it has a strong track record of operating.
• We recently conducted our first management interview with new CEO Daniel Henao. To watch the full interview, click here.

This morning, Mineros S.A. (MSA:TSX, MINEROS:CL) announced the acquisition of a 100% interest in a gold exploration project in Colombia from AngloGold Ashanti Colombia. The project hosts a 2024 historical resource and strengthens the Company’s project pipeline in Colombia, where it has demonstrated a long history of successful operations. The asset has historically struggled with permitting, and MSA hopes to redefine the project through its strong relationships in the country. We are maintaining our BUY rating and our target price of C$11.00/share on Mineros.

Transaction Details
Mineros will acquire all outstanding shares of AngloGold Ashanti Colombia for $10M in cash at closing, and contingent consideration of up to $60M based on total ore authorized under a PTO and approved environmental license. MSA has a strong balance sheet with $108M in cash at year-end, comfortably completing the acquisition on a cash-free, debt-free, zero net working capital basis, and anticipates a quick closing by the end of the month. To avoid confusion, we would highlight to readers that the acquisition is unrelated to AngloGold Ashanti’s Quebradona development project in Colombia.

Project Details
The project is located in the municipality of Cajamarca in the Department of Tolima, Colombia, ~150km west of Bogotá and 30km west of Ibagué. Historically, the project was referred to as La Colosa; however, MSA plans to define a new identity for the asset in collaboration with local communities, which will include a new name. The project is held under an integrated mining concession contract and has seen limited activity since 2017 due to delays in environmental permitting.

The December 2024 historical estimate outlines that the project hosts Indicated resources of 23.3Moz of gold at an average grade of 0.87 g/t and Inferred resources of 5.0Moz of gold at an average grade of 0.71 g/t. Mineros has noted that this estimate has not yet been verified as current and would require further work and potentially additional drilling before any update or reclassification.