Rio2 Acquires 99.1% Stake in Peru's Condestable Copper-Gold-Silver Mine

• Rio2 Limited (TSX: RIO; OTCQX: RIOFF; BVL: RIO) completed the acquisition of a 99.1% interest in the Condestable underground mine in Peru from Southern Peaks Mining on 30 January 2026.
• The transaction was financed through a C$191.1 million subscription receipt offering completed in December 2025, which converted to common shares upon closing, and US$65 million in vendor promissory notes with six-year terms.
• Condestable currently targets annual production of approximately 27,000 tonnes of copper equivalent and was operated by Southern Peaks for twelve years prior to the acquisition.
• Rio2 plans a six-month integration period to rationalise the management team whilst maintaining current production levels.
• The acquisition remains subject to final approval from the Toronto Stock Exchange.

Rio2 Limited (TSX: RIO; OTCQX: RIOFF; BVL: RIO) is a Vancouver-based mining company that operates two mines in Latin America: the Fenix Gold heap leach mine in Chile and the Condestable underground mine in Peru. The company produces gold from Fenix and copper, gold, and silver from Condestable. Management has experience in mine operations and capital markets. Rio2's subsidiaries, Fenix Gold Limitada and Compañia Minera Condestable, operate under environmental standards that exceed regulatory requirements.

Acquisition Of Condestable Mine

Rio2 closed the acquisition of the Condestable Mine on 30 January 2026 under a share purchase agreement dated 8 December 2025 with Southern Peaks Mining and Mr Adolfo Vera. Rio2 acquired all shares of certain Southern Peaks subsidiaries, including Ariana Management Corporation, which holds the 99.1% interest in Condestable. The transaction adds copper, gold, and silver production to Rio2's existing gold operations at Fenix.

Executive Chairman Alex Black stated:

"The acquisition of the Condestable Mine is the result of six months of rigorous due diligence and negotiations with Southern Peaks. Rio2 sees the Acquisition as a positive step for the Company in its quest to become a diversified and highly profitable Latin American miner." President and CEO Andrew Cox added: "The operational record of the Condestable Mine over the past twelve years has been exemplary. The integration process of Condestable with Rio2 is expected to take approximately six months as we rationalize and optimize the management team."

At closing, the parties waived the delivery of a Peruvian tax certificate as a condition, placing the majority of cash consideration into escrow for release upon receipt of the certificate. The share consideration will be issued to Southern Peaks following receipt of the same certificate. The acquisition remains subject to final Toronto Stock Exchange approval.

Equity Financing And Subscription Receipt Conversion

Rio2 raised C$191,130,345 through a bought deal financing of 86,094,750 subscription receipts at C$2.22 per unit on 15 December 2025. The offering was underwritten by Raymond James, Stifel Nicolaus Canada, and BMO Capital Markets. The subscription receipt structure allowed proceeds to be held in escrow until acquisition closing.

Upon closing of the acquisition, each subscription receipt automatically converted into one Rio2 common share. The subscription receipts were delisted from the Toronto Stock Exchange on 30 January 2026. Holders did not need to take action to receive their shares.

Net proceeds from the equity financing, along with interest earned during escrow, were used to fund part of the acquisition cash consideration. Remaining proceeds will support working capital and general corporate purposes.

Vendor Debt Financing

Rio2 issued two promissory notes to Southern Peaks as part of the consideration: a US$55 million secured note and a US$10 million subordinated mezzanine note. Both notes have six-year terms.

The secured note provides Southern Peaks with a priority claim against specific assets. The subordinated note ranks below the secured debt but ahead of equity. This structure is common in mining acquisitions of this scale.

The six-year repayment timeline provides Rio2 with time to integrate operations and generate cash flow from Condestable before debt repayments commence. Management targets annual production of around 27,000 tonnes of copper equivalent during the integration period.

Next Steps

Rio2 will spend the next six months integrating Condestable into its operations and rationalising the management structure between its Chilean and Peruvian assets. The company plans to maintain production at current target levels during this period. Management has stated its intention to grow resources, reserves, and production at Condestable in the coming years. Immediate priorities include obtaining final Toronto Stock Exchange approval and completing the integration process.

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