London-listed Anglesey Mining has struck a wide-reaching deal with its largest shareholder and creditor, Energold Minerals, that will eliminate nearly all of the company’s £4-million debt burden, inject fresh funding and reshape its board as it shifts full focus to the Parys Mountain project in North Wales.

Anglesey on Friday announced that it had signed a binding letter of intent with Energold covering a debt settlement, asset disposals and a £350 000 investment through the purchase of non-voting exchangeable warrants.

Under the debt settlement agreement, Anglesey will transfer its interests in Grängesberg Iron – held through subsidiary Angmag – and its 11.9% stake in Labrador Iron Mines Holdings to Energold in full satisfaction of outstanding loans originally advanced by Juno and Eurang. The combined liabilities, valued at about £4.05-million at March 31, will be reduced to about £100 000, relating only to a Parys Mountain property.

Energold has also agreed to waive any interim payments due under the Juno investment agreement until the Swedish approvals needed for the transfer of Angmag are received.

Anglesey chairperson Andrew King said the restructuring, alongside Energold’s new investment, placed the company “on a much firmer financial footing” as it advances the copper/zinc/lead/silver/gold VMS deposit at Parys Mountain.

Energold’s £350 000 investment will be made through a warrant offering priced at the five-day volume-weighted average price to December 8. The warrants will be exchangeable for new ordinary shares on a one-for-one basis, subject to UK takeover and national security rules. Anglesey will call an extraordinary general meeting before March 31 next year to seek approval for a share consolidation to support future issuances.

The company noted that further fundraising will still be required to drive development at Parys Mountain and said it continues to assess options.

Upon completion of the warrant offering, Energold president Brendan Cahill and veteran geologist and mining executive Jim Williams will join the Anglesey board as nonexecutive directors. They will sit alongside King, CEO Rob Marsden and independent director Doug Hall.