The deal will mean Aeris will raise about $40 million from investors.

The Cracow mine is forecast to produce between 82,500 – 87,500 ounces of gold in the 2020 financial year and generate net mine cashflow of $84 million to $89 million.

Aeris will also use $13 million to ramp up exploration around the mine which has 15 years of continuous production.

For 2021 Aeris is predicting production of up to 75,000 ounces of high margin gold at cash cost of $A980/oz.

Aeris executive chairman Andre Labuschagne said it also had a history replenishing its reserves.

The company also has the potential to utilise existing Aeris carried forward tax losses of $256 million.

Labuschagne said there was a lot of potential for gold in Queensland and the deal would give it a good footprint across the gold and copper sector.

The deal will also give Aeris immediate positive, free cashflow and was the right asset and skill-set for Aeris to unlock high value combination synergies with annual cost savings $4 millin across site, infrastructure, procurement and corporate cost savings.

The financing of the deal will include a $40 million equity raising and a $30 million acquisition bridge debt facility.

Aeris already has the support of its three largest shareholders for the equity raising. The three represent about 60 per cent of shares.

The equity raising will be conducted through a fully underwritten institutional placement and an underwritten 2.02 for 1 pro rata accelerated renounceable entitlement offer.

“Aeris inherits a well-run, proven operation which has been a consistent performer for Evolution,” Labuschagne said.

“Importantly for us, there is a strong operating team in place that has a culture of continuous improvement. We are confident that Cracow management and the workforce will fit well with Aeris’ own culture and the renewed focus to reinvesting in mine life extensions which Aeris will bring.”