Toro Energy scores finance and asset acquisition

THE BOURSE WHISPERER: Toro Energy (ASX: TOE) has struck binding financing and asset acquisition agreements with Canada-based global resources investor, The Sentient Group.

Toro said the transactions deliver a committed $10 million cash injection and increase its asset base with an entry to the Canadian uranium sector through the acquisition of an interest in Strateco Resources Inc.

A key feature of the deal is that Sentient becomes a new key shareholder in Toro, which in turn will emerge with a strong four year cash base and interests in an expanded global uranium project portfolio.

Toro indicated negotiations for a further $10 million of project level funding are currently underway and are at an advanced stage.

Under the terms of a Subscription and Securities Sale Agreement (SSSA), Sentient has agreed to subscribe for 125 million new fully paid ordinary shares in Toro at 8 cents per share for $10 million.

Toro has acquired a 19.8 per cent interest in Strateco, a C$3 million senior secured loan receivable in Strateco, C$14.1 million of junior secured Convertible Notes in Strateco and certain other interests from Sentient in return for 236.5 million new fully paid ordinary shares in Toro.

In return for the funding, Toro will pay Sentient a Unitisation Fee equal to 2.5 per cent of gross proceeds derived from the company’s Wiluna uranium mine in Western Australia.

“Toro is pleased to have secured Sentient’s funding commitment and to have expanded our global uranium portfolio,” Toro Energy managing director Dr Vanessa Guthrie said in the company’s announcement to the Australian Securities Exchange.

“The Transactions introduce a major new shareholder in Sentient.

“This should enable us to focus on bringing Wiluna into production into the expected emerging market supply gap and promoting the potential of the Wiluna uranium province, while building an initial global asset base that maximises for our shareholders the upside potential of an improving uranium price.

“We welcome Sentient as a new significant shareholder in Toro, and look forward to working with its management to both improve the Wiluna project as well as developing our global uranium portfolio aspirations.”

Toro said its two largest shareholders – Oz Minerals (ASX: OZL) and Mega Uranium – have said they both support the transactions to the extent that if any shareholder approvals are required for its implementation, they intend to vote in favour of the resolutions.

Email: info@toroenergy.com.au

Website: www.toroenergy.com.au