Denarius Metals Announces Agreement to Acquire a 100% Interest in the Toral Zn-Pb-Ag Project, Leon Province, Northern Spain

Rhea-AI Summary

Denarius Metals Corp. (Cboe CA: DMET) (OTCQX: DNRSF) has signed a binding LOI to acquire 100% of Europa Metals Iberia S.L., which holds the Toral Zn-Pb-Ag Project in Northern Spain. The transaction, expected to close by October 31, 2024, aligns with Denarius' vision of producing low-carbon metals within the EU. The purchase price includes funds already advanced (US$3.1 million) and an additional CA$3.5 million in Denarius shares.

Key points:

• Acquisition strengthens Denarius' liquidity and flexibility in project development
• Denarius plans to update the Mineral Resource estimate and conduct a preliminary economic assessment
• The company has completed a 6,200-meter drilling campaign at Toral
• A formal mining license application has been filed

Positive

• Acquisition of 100% interest in Toral Zn-Pb-Ag Project strengthens Denarius Metals' portfolio
• Transaction aligns with company's vision of producing low-carbon metals within the EU
• Improved flexibility in managing development schedule for Spanish projects
• Successful completion of 6,200-meter drilling campaign at Toral Project
• Formal mining license application filed with local authorities

Negative

• Additional CA$3.5 million in shares to be issued, potentially diluting existing shareholders
• Transaction subject to various approvals, including regulatory and shareholder consent

Toronto, Ontario--(Newsfile Corp. - September 17, 2024) - Denarius Metals Corp. (Cboe CA: DMET) (OTCQX: DNRSF) ("Denarius Metals" or "the Company") announced today that it has signed a binding letter of intent ("LOI") with Europa Metals Ltd. ("Europa") (AIM: EUZ) whereby the Company will acquire 100% of the issued and outstanding shares of Europa Metals Iberia S.L. ("EMI") (the "Transaction"), a wholly owned Spanish subsidiary of Europa which holds the Toral Zn-Pb-Ag Project (the "Toral Project") in the Leon Province, Northern Spain. The closing of the Transaction ("Closing") is expected to occur no later than October 31, 2024.

Serafino Iacono, Executive Chairman and CEO, commented, "The Transaction is in keeping with our vision of producing low-carbon metals within the European Union to support climate transition and the EU's bid to secure the resources needed for technologies such as renewable energy and battery power. Our work to date provides us with confidence in the potential for the Toral Project to become a long-life underground mining operation which may supply material to the 5,000 tonnes per day processing plant at our Aguablanca Project in Spain. Completing the acquisition of 100% of the Toral Project through the Transaction strengthens our liquidity and improves our flexibility to manage the development schedule for our projects in Spain without having to meet the specific obligations mandated under the Option Agreement. Later this year, we will commence work on the preparation of an updated Mineral Resource estimate followed by a preliminary economic assessment for the Toral Project."

The Company and Europa entered into a definitive option agreement dated November 22, 2022 (the "Option Agreement") pursuant to which the Company was granted options to acquire, in two stages, up to an 80% ownership interest in EMI. In conjunction with its commitments under the First Option, the Company has been carrying out an exploration program at the Toral Project since the beginning of 2023 and, to date, the Company has funded approximately US$3.1 million through a loan agreement dated November 22, 2022 between the Company, Europa and EMI (the "Loan Agreement"). In 2023, the Company carried out a drilling campaign which comprised approximately 6,200 meters of validation and infill drilling in nine holes completed within the Toral Project's known Indicated Mineral Resource area. All holes completed were successful in intersecting mineralization adjacent to selected, previously reported high grade intersections within the Toral Project's Indicated Resource block. In addition, the formal application for a mining license was also filed with the local authority in 2023 as required under the Option Agreement.

The purchase price for the Company's acquisition of a 100% equity interest in EMI will be the funds advanced under the Loan Agreement and an additional CA$3.5 million to be settled through the issuance of 7,000,000 common shares of the Company at a price of CA$0.50 per share. The common shares to be issued in the Transaction will be subject to a hold period ending on the date that is four months plus one day following the issuance date. As a condition to Closing, Europa will capitalize all amounts payable from EMI to Europa prior to Closing such that on Closing, EMI shall not owe any funds or have any outstanding liabilities to Europa. The Option Agreement and the Loan Agreement will also be terminated on Closing.

The Transaction is subject to each of the Company, Europa and EMI receiving all necessary board, shareholder and regulatory approvals including, but not limited to, approval by Cboe Canada Inc.

About Denarius Metals

Denarius Metals is a Canadian junior company engaged in the acquisition, exploration, development and eventual operation of polymetallic mining projects in high-grade districts.

In Spain, the Company owns a 100% interest in the Lomero Project, a polymetallic deposit located on the Spanish side of the prolific copper rich Iberian Pyrite Belt, and a 50% interest in Rio Narcea Recursos, S.L. which owns a 5,000 tpd processing plant and has the rights to exploit the historic producing Aguablanca nickel-copper mine, located in Monesterio, Extremadura, Spain, approximately 88 km northwest of the Lomero Project. The Company is also carrying out an exploration campaign on the Toral Project located in the Leon Province, Northern Spain pursuant to an option and joint-venture arrangement with Europa.

In Colombia, Denarius Metals is carrying out construction activities at its 100%-owned Zancudo Project, which includes the historic producing Independencia mine, to develop production and cash flow expected to commence in the fourth quarter of 2024 through local contract mining. The Company is currently carrying out a 10,000 meters drilling program on the Zancudo deposit which remains open in all directions.

Additional information on Denarius Metals can be found on its website at www.denariusmetals.com and by reviewing its profile on SEDAR+ at www.sedarplus.ca.

Cautionary Statement on Forward-Looking Information

This news release contains "forward-looking information", which may include, but is not limited to, statements with respect to anticipated business plans or strategies, including timing of Closing of the Transaction and receipt of regulatory and other approvals for the Transaction. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", or "believes" or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Denarius Metals to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Factors that could cause actual results to differ materially from those anticipated in these forward-looking statements are described under the caption "Risk Factors" in the Company's Annual Information Form dated April 25, 2024 which is available for view on SEDAR+ at www.sedarplus.ca. Forward-looking statements contained herein are made as of the date of this press release and Denarius Metals disclaims, other than as required by law, any obligation to update any forward-looking statements whether as a result of new information, results, future events, circumstances, or if management's estimates or opinions should change, or otherwise. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, the reader is cautioned not to place undue reliance on forward-looking statements.

For Further Information, Contact:

Michael Davies
Chief Financial Officer
(416) 360-4653
investors@denariusmetals.com

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/223506

FAQ

What is Denarius Metals acquiring in the Toral Project transaction?

Denarius Metals is acquiring 100% of the issued and outstanding shares of Europa Metals Iberia S.L., which holds the Toral Zn-Pb-Ag Project in Leon Province, Northern Spain.

When is the Toral Project acquisition expected to close?

The closing of the Toral Project acquisition is expected to occur no later than October 31, 2024.

How much is Denarius Metals (DNRSF) paying for the Toral Project?

Denarius Metals is paying the US$3.1 million already advanced under a loan agreement, plus an additional CA$3.5 million to be settled through the issuance of 7,000,000 common shares at CA$0.50 per share.

What exploration work has Denarius Metals conducted at the Toral Project?

Denarius Metals has carried out a drilling campaign comprising approximately 6,200 meters of validation and infill drilling in nine holes within the Toral Project's known Indicated Mineral Resource area.

What are Denarius Metals' (DNRSF) plans for the Toral Project after acquisition?

Denarius Metals plans to commence work on preparing an updated Mineral Resource estimate followed by a preliminary economic assessment for the Toral Project.