Patrician and JCI to form alliance

South African-based JCI intends to acquire up to a 20% interest in Patrician Gold Mines (ASE).

The senior producer has signed a letter of intent to buy 2 million Patrician special warrants at 75 CENTS per warrant. Each special warrant consists of one common share and a common share purchase warrant exercisable for one year from the closing date at a price of 78 CENTS. Should JCI exercise all warrants, it would hold a 20% equity interest in Patrician.

Patrician is forming an alliance with JCI in an effort to turn itself into a North American funding vehicle for the exploration and development of precious metals properties in Africa.

Patrician has decided to drop its option on the Winteroad property in northeastern Ontario, so that it may focus on its growing African property portfolio.

JCI’s share purchase is expected to raise $1.5 million, half of which Patrician will spend exploring its properties in Ghana and Tanzania. The remainder will be placed in an escrow account pending Patrician raising an additional $5 million within 90 days.

Patrician has also placed an additional 500,000 special warrants with two institutions, bringing the total funds raised to $1.9 million. Total shares outstanding will rise to beyond 9.8 million shares. On a fully diluted basis, there will be almost 20 million outstanding.

It is proposed that JCI will receive pro rata representation on Patrician’s board, together with the right to manage any of the junior’s properties once a decision is made to proceed with a feasibility study. In return, Patrician will receive technical support from JCI.

Meanwhile, Patrician has received preliminary results from a drill hole completed on its Wingayongo property in Tanzania. The 26 samples returned gold values ranging from 0.06-0.75 gram per tonne.