(Bloomberg) -- Rigel Resource Acquisition Corp., a New York-listed blank-check company, is in talks to combine with a South African gold miner, people with knowledge of the matter said. 

The deal could value Blyvooruitzicht Gold Mining Co. at as much as $425 million, said the people, who asked not to be identified as the details aren’t public yet. 

The blank check company backed by Orion Resource Partners, a money manager with $8.5 billion of assets, hired Citigroup Inc. and Rand Merchant Bank to do a pre-sale and raise about $60 million early in 2024, said the people.

Blyvooruitzicht, Citigroup and Rand Merchant Bank declined to comment on the matter. Rigel didn’t respond to emailed requests for comment. Talks are ongoing, and there is no guarantee that a deal will be successfully concluded, said one of the people.    

Rigel previously said the company signed a non-binding letter of intent for a business combination with a company in the global metals sector without providing details of the target. 

Special purpose acquisition companies, or blank check companies, have attracted high-profile miners including Robert Friedland, who formed Ivanhoe Capital Acquisition Corp., and African Gold Acquisition Corp. that raised $360 million to target gold-mining assets. 

The drawback that SPACs may have with mining assets is the limited time-frame to deploy the money raised through the listing as it takes time to secure, complete due-diligence and vet a mine. Rigel has also previously requested an extension to the time it had to “consummate an initial business combination” for a year from Aug. 9, according to a company notice. 

Blyvooruitzicht produces 40,000 ounces of gold a year and the life of the mine is 22 years, according to its website. 

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