Orange Minerals (ASX:OMX) entered into a binding agreement to divest several tenements from its Majestic Project in Western Australia.
The assets are being offloaded to Auravelle Metals (ASX:AUV) as part of a broader effort by Orange Minerals to rationalise its portfolio and extract value from non-core holdings.
Under the terms of the transaction, Orange Minerals is set to receive $200,000 worth of Auravelle shares.
The specific number of shares will be determined by Auravelle's 5-day volume-weighted average price leading up to the execution of the agreement.
As a result of the deal, Auravelle will take full responsibility for the underlying tenement package and all associated environmental and regulatory obligations.
The divestment also triggered an adjustment to an existing royalty obligation.
To facilitate the deal, Orange Minerals has agreed to issue $25,000 worth of its own shares to the current royalty holder.
Management noted that this move allows the company to sharpen its focus on high-priority assets.
By offloading the Majestic Project tenements, Orange Minerals intends to redirect its capital and technical expertise towards its flagship Tepa Gold Project in Ghana.
The completion of the sale remains subject to customary closing conditions, including the issuance of the consideration shares by Auravelle.
At the time of reporting, Orange Minerals’ share price was $0.057.