StockMarketWire.com - Shanta Gold has agreed with Helio Resource Corp to acquire all of the latter company's issued and outstanding common shares by way of a statutory plan of arrangement.

The recommended arm's-length arrangement was subject to approval by Helio shareholders and the British Columbia Supreme Court. Shanta would acquire all of Helio's shares in exchange for 59.5m shares in Shanta.

Shanta would acquire Helio's SMP project, which was adjacent to its operating New Luika Gold Mine (NLGM).

Helio's resource comprised a NI 43-101 compliant gold resource consisting of 635k gold oz at an average grade of 2.4g/t. All of these resources were located within 20km of the Shanta's existing NLGM processing plant.

The deal would result in an increase in Shanta's gold resource ounces of 77% from 824koz at 1.9g/t to 1459koz at 2.09g/t. These ounces were not yet incorporated into NLGM's mine plan.

Separately, Shanta proposed raising about $14.0m gross via a placing and direct subscription.

"In conjunction with the (debt) restructuring and the Helio acquisition, the fundraising will provide Shanta with a strong platform to deliver returns to its shareholders," it said in a statement.

"The proceeds of the fundraising will provide funds for growth allowing Shanta to deliver the Revised Mine Plan (RMP), integrate Helio's assets into the New Luika Gold Mine (NLGM) mine plan and to seek out and firm up high grade opportunities in the surrounding area."





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