Goldgroup Resources to acquire 70% interest in Caballo Blanco Gold Project, Mexico from NGEx Resources

Goldgroup Resources, Inc. has entered into share purchase agreement to acquire a 70% interest in Caballo Blanco Gold Project located in Mexico from NGEx Resources, Inc. (formerly Canadian Gold Hunter Corp.), a mineral exploration company, for CAD15 million ($14.15 million). Goldgroup is a premier gold producer. Both the entities are based in Canada.

Caballo Blanco is located in the State of Veracruz, Mexico. The concession area is 15,000 hectares covering a large mineralized system with a multitude of gold and gold-copper anomalies.

As a part of consideration, Goldgroup has agreed to pay CAD6 million ($5.66 million) in cash and Goldgroup will issue 9 million shares at a deemed price of CAD1 ($0.94) per share to NGEx.

Upon completion, NGEx will own 19.6% stake in Goldgroup's issued shares. In addition, NGEx will receive a 1.5% net smelter return royalty and upon the project reaching commercial production, NGEx shall receive a one-time advance royalty payment in the amount of CDN5 million ($4.71 million).

Deal Value (US$ Million) 14.15
Deal Type                Acquisition
Sub-Category             Asset Purchase
Deal Status              Announced: 2009-11-25

Deal Participants

Target (Company)   NGEx Resources, Inc. - Caballo Blanco Gold Project - Veracruz, Mexico
Acquirer (Company) Goldgroup Resources, Inc.
Vendor (Company)   NGEx Resources, Inc. (formerly Canadian Gold Hunter Corp.)

% Acquisition 70%

Related terms: acquisition, canada, commercial, copper, exploration, gold, mexico