Impact: Positive
Sterling Metals has signed a definitive agreement with Copper Road Resources Inc. (TSXV: CRD, Not Rated) to acquire a 100% interest in its Copper Road project, located ~80km north of Sault Ste. Marie in Ontario. Sterling is expected to issue shares equivalent to ~98% of its 112.5M outstanding shares and pay C$460k in cash, such that it would own ~51% of the company post-transaction. The deal is valued at ~C$4.3M, representing a ~70% premium to CRD’s last close. The Copper Road project is located on the Midcontinental Rift (MCR) and hosts two past-producing mines. Latest drilling confirmed the presence of breccia and porphyry deposits on the project, which underscores potential for larger intrusion related mineralization. We believe this is a beneficial acquisition for Sterling as it adds a more advanced exploration project in an underexplored part of the tier-one jurisdiction of Ontario to its existing, earlier-stage portfolio. Additionally, Sterling’s C$4M in treasury and technical expertise should enable it to more rapidly explore and test known zones on the project than the previous owner.