Key Highlights

•  The deal is valued at about US$79 million, or A$113 million, and would give Turaco full control of the project's private ownership.

•  Consideration is US$30 million in cash, 55.1 million shares subject to 12-month voluntary escrow and 36.7 million unlisted options expiring three years after issue.

•  The Ivorian Government retains a 10 per cent non-contributing interest, and the announcement did not specify a date for exercise.

Turaco Gold (ASX:TCG) has agreed terms to acquire the 20% interest in the Afema Gold Project in Côte d'Ivoire held by Bahamas-based Sodim, in a deal valued at about US$79 million, or A$113 million. Completion would give Turaco full control of the project's private ownership, with the Ivorian Government retaining a 10% non-contributing interest.

Deal structure

The consideration payable to Sodim combines cash, shares and options. Turaco will pay US$30 million in cash, issue 55.1 million shares that will be subject to 12-month voluntary escrow, and grant 36.7 million unlisted options expiring three years after issue. Of those options, 60% are exercisable at A$1.00 and 40% at A$1.20.

The arrangement takes the form of an option. Turaco paid a non-refundable fee of US$3 million (about A$4.3 million) for a three-month option, and consideration is payable within five business days of exercise. The announcement did not specify a date for exercise.

Sodim will also receive a 0.33% net smelter return royalty, which Turaco intends to buy back for US$12.5 million before 30 June 2027. Contingent payments apply too: US$3 an ounce for resource growth beyond 5 million ounces within the granted mining permit, and US$5 an ounce for resources defined within exploration permits until 30 June 2034.

What it removes

Completion would extinguish a Sodim loan of about US$24 million, a discovery payment of up to US$2.5 million and the existing shareholder agreements between the parties. Removing these layers should simplify financing discussions, since lenders typically prefer a clear ownership and cash-flow structure before committing project debt. It also gives Turaco direct control over decisions on development timing, contracting and future exploration across the permits.

Funding and approvals

Turaco requested a trading halt to undertake an equity placement and plans a share purchase plan, with proceeds to fund the cash component of the deal. The money will also go towards a definitive feasibility study (DFS), exploration and early works ahead of a final investment decision. Turaco shareholder approval will then be sought in early December 2026.

Managing Director Justin Tremain said consolidating ownership was "a major step towards development". He said Turaco had built a strong relationship with Sodim over two and a half years and that Sodim's acceptance of escrowed shares demonstrated its continued confidence in Afema.

Project context

Afema is located in Côte d'Ivoire, one of West Africa's more active gold exploration jurisdictions. A granted mining permit covers part of the project, while surrounding exploration permits offer further discovery potential, as reflected in the contingent payment terms. The announcement did not restate Afema's current mineral resource, so investors should refer to Turaco's own disclosures for tonnage and grade.

The DFS is due in the June quarter of 2027, and debt financing is being advanced in parallel with the final study workstreams. Tremain said the transaction clears the way to accelerate early works, which could shorten the time between a positive study and the start of construction if funding is secured.

Risks and considerations

The deal brings dilution through the new shares, the options and the capital raising needed to fund the cash payment. It also adds obligations, including the royalty buyback and potential per-ounce payments that would rise if exploration succeeds. Completion depends on shareholder approval and on Turaco raising sufficient funds, and a development decision still hinges on the DFS outcome, financing terms and the gold price.

Investors will watch for the outcome of the placement and share purchase plan, the December shareholder meeting, option exercise and progress on the feasibility study and project debt. If these steps are completed on time, Turaco would enter 2027 as the sole private owner of Afema, subject to the government's interest.