LCL Resources’ Colombian Asset Sale Now Worth $14M with $6.5M at First Gold Pour
LCL Resources has renegotiated its sale option agreement with Tiger Gold Corp, increasing the total consideration to $14 million and removing the 'Stay Private' clause. The revised terms will be presented for shareholder approval at the upcoming AGM.
- Total sale consideration increased from $2.5M to $14M
- Payment schedule revised with $6.5M payable at first gold pour
- 'Stay Private' option removed from agreement
- Shareholder vote scheduled at upcoming AGM, delayed pending ASX approval
- Major shareholders representing 26% support the transaction
Background on the Sale Option
LCL Resources Limited (ASX:LCL) has updated the terms of its binding Share Purchase Option Agreement with Tiger Gold Corp, concerning the sale of its Colombian gold assets, the Andes Gold Project and the Quinchia Gold Project. This follows an initial announcement in April 2025 and reflects a strategic move to maximise shareholder value while facilitating Tiger Gold's path to listing.
Key Changes to the Deal Structure
The headline change is a substantial increase in total consideration, now set at $14 million, up from the original $2.5 million payable upon first gold pour. The payment schedule has been restructured into four tranches: $1 million upon notice of option exercise, $2 million within eight months, $4.5 million within twelve months, and $6.5 million upon first gold pour. This staggered approach balances immediate cash flow with milestone-based incentives.
Notably, the previously included 'Stay Private' option has been removed, simplifying the agreement and potentially accelerating Tiger Gold’s listing ambitions. The deal also preserves a 1% net smelter royalty on products from the Colombian assets, following satisfaction of an existing RMB royalty, which adds a layer of ongoing revenue potential for LCL.
Shareholder Approval and AGM Timing
The amended terms are subject to shareholder approval at LCL’s upcoming Annual General Meeting (AGM). However, the AGM has been delayed as the company works with the ASX to finalise the meeting notice. LCL expects to dispatch the notice imminently once approval is granted. Encouragingly, major shareholders representing approximately 26% of issued capital have already committed their support, just shy of the 27% threshold needed to secure irrevocable proxies in favour of the deal.
Executive Chair Chris van Wijk expressed optimism about the revised agreement, highlighting the simplified structure and enhanced value as strong incentives for shareholder approval. The transaction is positioned as a pivotal step enabling Tiger Gold to list and actively develop the Colombian assets.
Implications for LCL and the Market
This renegotiation signals LCL’s intent to unlock value from its Colombian portfolio while mitigating execution risk through milestone payments. The removal of the 'Stay Private' option may also reflect confidence in Tiger Gold’s prospects or a strategic concession to expedite the deal. Investors will be watching closely for the AGM outcome and subsequent progress by Tiger Gold, as these will influence LCL’s near-term financial position and longer-term exposure to the Colombian gold projects.
Bottom Line?
LCL’s enhanced deal terms set the stage for a crucial AGM vote that could reshape its Colombian asset strategy.
Questions in the middle?
- Will LCL secure the necessary shareholder votes to approve the amended option agreement?
- How quickly can Tiger Gold progress to first gold pour and trigger the largest payment tranche?
- What are the implications of removing the 'Stay Private' option for Tiger Gold’s listing timeline?
