The Todd River Resources Ltd (ASX: TRT) share price has risen by 50% to $0.039 since it came out of a trading halt on Wednesday. This follows an announcement on Wednesday morning related to an acquisition that the company labelled as "highly prospective".
What did Todd River Resources announce?
Todd River Resources announced on Wednesday that it had entered an agreement to acquire 100% of 2 private companies – Marlee Base Metals Pty Ltd and Moonknight Pty Ltd. Following the acquisitions, the company will hold a 270km² land position in the South West Yilgarn Craton, Western Australia.
According to the announcement, this land has numerous nickel-copper bodies over more than 40km of strike extent. The key project area is the Berkshire Valley Project, which is located 100km north of a recent discovery of nickel, copper and platinum at Julimar by Chalice Gold Mines Limited (ASX: CHN).
One of the acquisitions also includes the ownership of 3 additional nickel, cobalt and copper targets in Western Australia.
The company will pay cash of $100,000 for the acquisitions along with scrip of 100,000,001 Todd River Resources shares. A director from one of the companies acquired, Ian Murray, also the former managing director of Gold Road Resources Ltd (ASX: GOR), will join the Todd River Resources board.
The transaction will be subject to shareholder approval at an extraordinary general meeting. If the transaction is approved, the company plans to start exploration immediately.
How has Todd River Resources performed recently?
Todd River Resources is an exploration company that holds a portfolio of base metals and gold exploration assets in Australia.
According to the company's most recent quarterly report, Todd River Resources ended the quarter with $1.55 million in cash (as at 31 March 2020). In that quarter, the company completed design of geological programs that were ready to be implemented at its Nanutarra Nickel and Mt Hardy projects. Additionally, while there had been some delay in exploration at Mt Hardy due to travel restrictions, an aircore drilling program to test extension of a known anomalism had been designed and was planned to be commenced in the third quarter.
Due to the economic impacts of the coronavirus, directors of the company saw a 40% pay cut for the final quarter of the 2020 financial year. The company predicted that spending would be subdued for the next 2 quarters, but that it would recommence exploration activities at the earliest opportunity.
About the Todd River Resources share price
At the time of writing, Todd River Resources shares are up 387.5% from their 52-week low of $0.008 cents. The Todd River Resources share price has returned 95% since the beginning of the year, but is down by 2.5% since this time last year.
