Comstock completes $45 million mining sale
- Comstock completed the sale of its legacy mining, processing, and real estate entities to Mackay Precious Metals in a deal valued above $45 million.
- The company received $20 million in cash and 2 million Mackay Gold & Silver shares valued at about $4.5 million.
- Comstock stated that the transaction is expected to reduce operating costs by about $1.5 million annually.
Comstock (NYSE:LODE) announced the completion of its sale of legacy mining, processing, and related real estate entities to Mackay Precious Metals, a subsidiary of Mackay Gold & Silver Corp., in a transaction valued at more than $45 million.
The deal transfers four mining subsidiaries, including mining claims, town lots, processing facilities, permits, and water rights, while Mackay assumes related reclamation responsibilities, liabilities, and surety deposits.
Comstock received $20 million in cash and 2 million Mackay Gold & Silver common shares currently valued at about $4.5 million, and expects to record a $10 million–$12 million gain with no associated cash taxes.
Comstock stated that the transaction reduces operating costs by about $1.5 million annually.
The company retains a 1.5% net smelter return royalty on production from the sold properties, along with a secured $7 million second-tranche payment due within 18 months.
Comstock also retains a potential $10 million contingent payment tied to mine construction or a change of control transaction valued at or above $500 million, while Mackay takes ownership of the transferred mining assets.
