Dolly Varden Silver (DVS) said Monday it signed a definitive agreement to acquire Hecla Mining's (HL) Kinskuch property in British Columbia's Golden Triangle for CA$5 million ($3.6 million) in an all-share transaction.
The acquisition will consolidate the two companies' project areas and increase Dolly Varden's Kitsault Valley project size to about 77,000 hectares.
The combined district-scale land package will include the Kitsault Valley, Big Bulk, and Kinskuch projects and cover some of the most underexplored and prospective rocks for silver, gold, and copper mineralization in the region, according to the company.
Dolly Varden will issue about 1.35 million common shares to Hecla as consideration. Hecla will retain a 2% net smelter return royalty on the Kinskuch property, with a 50% buyback right allowing Dolly Varden to reduce the royalty to 1% for $5 million.
Under a prior agreement, Hecla will maintain a seat on Dolly Varden's technical committee.
The transaction is subject to regulatory approvals and is expected to be completed in mid-May, Dolly Varden said.
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