Business
Strategic investment
Strategic investment.
About this update from Hochschild Mining Plc
[{"type":"text","content":"\n RNS Number : 8529J Hochschild Mining PLC 10 December 2008 \n \n \n\n10 December 2008\n\nHochschild Mining enters into strategic investment with Gold Resource Corporation\n\n\n\nProvides exposure to high grade, low cost ounces in a mining friendly country with significant mineral potential\n\n\n$5 million private placement for 5% of GRC at $3 per share\n\n\n19% premium over the closing price on Friday 4 December and a 20% discount on the 6 month average price \n\n\n80 day option to purchase a further 15% at $3 per share \n\n\n\nHochschild Mining plc ('Hochschild') is pleased to announce a $5 million strategic investment in Gold Resource Corporation ('GRC'), a US OTC BB traded underground precious metals mining company with a number of prime development projects in southern Mexico. The investment creates an additional operational cluster for Hochschild, providing exposure to high grade, low cost ounces in a mining friendly country with significant mineral potential.\n\nGRC will use the proceeds from the transaction to fund development of its flagship property, El Aguila, in the southern state of Oaxaca, and is currently expected to commence production by mid 2009 at 70 thousand ounces of gold (4.2 million silver equivalent ounces) per year. El Aguila is located in an emergent and promising district that has not been extensively explored. The deposit comprises 75% gold and silver and 25% zinc, copper and lead at current prices. \n\nEduardo Hochschild, Executive Chairman of Hochschild Mining plc, commented;\n\n'We are delighted to announce this transaction which provides Hochschild access to low cost, high grade ounces with a near term production profile. We have well established operations in Mexico and are keen to strengthen our position in this mineral rich and mining friendly region of the Americas. Gold Resource Corporation has a highly experienced management team and we look forward to working with them to...