Western Copper (NYSE:) and Gold Corporation has received a strategic boost from mining giant Rio Tinto (NYSE:) Canada Inc. with a C$6 million investment aimed at advancing the Casino Project in Yukon. This capital infusion increases Rio Tinto’s ownership in Western to approximately 9.7% and is earmarked for accelerating infrastructure development and regulatory processes essential for the project’s progression.
The investment, involving the purchase of shares at C$1.73 each, is part of a broader collaboration between the two companies. An amended investor rights agreement will come into force post-investment, providing Rio Tinto with several governance privileges. The privileges include:
- The right to nominate members to the Technical and Sustainability Committee.
- A non-voting observer role at board meetings.
- The option to appoint a director and second up to three individuals to assist with the project if its ownership exceeds 12.5%.
In addition to these governance rights, Rio Tinto has also pledged to support Western’s board nominations and agreed to a standstill provision, refraining from any further changes to its shareholding position, except under specific circumstances, for an 18-month period following the transaction’s closure. This standstill includes both selling and acquiring additional securities of Western.
This transaction is expected to conclude around December 12, 2023, subject to the necessary regulatory consents from the Toronto Stock Exchange and NYSE American LLC, and will adhere to a statutory hold period as required by applicable securities laws.
The collaboration underscores a mutual commitment to the Casino Project, with both Western’s President and CEO, Paul West-Sells, and Rio Tinto’s Chief Executive of , Bold Baatar, emphasizing the importance of streamlining project development. This partnership not only solidifies Rio Tinto’s influence within Western but also enhances the project’s viability through the provision of additional resources and expertise.
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