The Thomson Resources Ltd (ASX: TMZ) share price ended the day higher after providing an update on the sale of the Webbs and Conrad Projects. At market close, shares in the Australian-based exploration company finished at 18 cents, up 9.37%.
Let's take a look and see why the company's shares rose strongly.
What did Thomson announce?
The Thomson share price advanced higher after reporting progress on its deal with Silver Mines Limited (ASX: SVL).
According to its release, Thomson advised that it reached an agreement with Silver Mines to amend the sale contracts of the Webbs and Conrad Projects.
Both companies originally signed a binding term sheet in November last year for Thomson to acquire both silver projects. In effect, this would make Thomson a major gold and silver exploration and mining company.
Under the revised document, Thomson will pay a combination of cash and shares to finalise the sale. This includes a non-refundable payment of $750,000 which has been paid to Silver Mines.
A further payment will need to be made equivalent to the cash bonds in place, which is estimated to be around $269,000.
In addition, Thomson will issue Silver Mines' 70 million fully paid ordinary shares split across two tranches. Attached to the ordinary shares will be 50 million options at an exercise price of 12.4 cents per option. This will expire within 3 years from the date of issue.
While the agreement has been laid out, shareholder approval is still needed for the deal to go ahead. Thomson has planned to hold a meeting in mid-March for shareholders to give to okay to issue the shares.
Share price review
Over the past 12 months, the Thomson share price has accelerated to give investors gains of over 740%. In March, the company's shares listed for as low as 0.02 cents before moving on an upwards trajectory.
Based on the current share price, Thomson has a market capitalisation of almost $60 million
