McEwen adds Minera Andes to his roster

Vancouver – Minera Andes (MAI-V) is the latest junior explorer to fall into the sights of Robert McEwen, who is investing $10 million in the company.

The deal has the ex-CEO and chairman of Goldcorp (G-T, GG-N) subscribing to two private placements, in tranches of 15,414,740 and 13,156,689 units, priced at 35 apiece. Units consist of one common Minera Andes share and one-half a share purchase warrant. Warrants are exercisable at 55 for two years or until 15 days following an average share price of $1.00 has been realized for 20 consecutive days, commencing 120 days after warrant issuance.

The initial tranche will give McEwen a 14.2% interest in the company, exclusive of the warrants. Completion of the second tranche will give him 23.5% ownership. He also will have the right to nominate a director and to participate in future financings.Funds will be primarily allocated towards ongoing development and exploration on the San Jos gold-silver project in southern Argentina’s Santa Cruz province. A recently completed feasibility study indicated positive economics for development of the Frea and Huevos Verdes veins.

The study reviewed proven and probable reserves of almost 1.2 million tonnes grading 7.7 grams gold per tonne and 406 grams silver per tonne (containing 288,000 oz. of gold and 15.2 million oz. of silver). A proposed 750-tonne-per-day underground operation is expected to produce almost 61,000 oz. of gold and 3.1 million oz. of silver annually over a 4.3 year mine life.

San Jos is held 49% by Minera Andes and 51% by project operator Mauricio Hochschild, a specialist in underground mining of vein-hosted metal deposits.

Following announcement of McEwen’s investment on Dec. 21st, investors leapt on the stock to rally Minera Andes’ share price 12% to close at 52 apiece on high volume.