Jangada to acquire stake in Brazil's MTgold

(Sharecast News) - Natural resources developer Jangada Mines said on Monday that it had agreed to the potential acquisition of an initial 33.3% equity interest in MTgold, with an option to increase its stake to 50.1%.

Jangada has now been granted a period of up to 60 days to complete ongoing due diligence and proceed to the execution of definitive documentation for the acuisition of MTgold, the owner of the highly prospective Paranaíta gold project, located in Brazil's Alta Floresta - Juruena Gold Province.

To fund the potential acquisition, execute a rapid development programme at Paranaíta and for additional working capital, Jangada has already raised £800,000 through a placing of 133.33m new ordinary shares at a price of 0.6p share. Also, Jangada will issue an investor warrant of one warrant per one placing share, exercisable at 1.0p for a period of two years from admission.

Alongside this, directors elected to convert accrued fees of £350,000 through the issue of 58.33m ordinary shares at the placing price.

Jangada's board believes that the alignment of widespread gold mineralisation, with geochemical anomalies and their correlation with magnetic structures, "strongly indicates" the potential presence of a large-scale gold deposit

"Next phase of exploration, comprising geophysics, trenching, drilling, and metallurgical testing, will target multiple gold structures open in all directions to rapidly upscale the project," said Jangada.

As of 0900 BST, Jangada shares had sunk 33% to 0.67p.

Reporting by Iain Gilbert at Sharecast.com