Resource News

Exeter Resource approves spin-out of Argentina project

TORONTO (miningweekly.com) – Vancouver-based Exeter Resource plans to spin-out its Cerro Moro gold/silver project and other properties in Argentina into a new company, dubbed Newco for now, the firm announced on Tuesday.

Exeter will retain its Caspiche gold/copper discovery in Chile and around C$50-million in working capital. Newco will receive C$25-million in working capital.
The transaction is designed to create value for Exeter shareholders by unlocking the value of Cerro Moro and the other exploration properties in Argentina, Exeter said in a statement.

“Since the discovery of the large Caspiche gold-copper deposit in Chile, with its 19,6-million ounce inferred gold resource, investor focus has logically been centred on the opportunity provided by such a sizeable discovery,” commented chairperson Yale Simpson.

“The creation of Newco is expected to enhance shareholder value by bringing both investor focus and technical expertise to the Cerro Moro asset.”

Shareholders will vote on the proposal in March. If the deal goes ahead, investors will receive one share in Newco for each share held in Exeter.

Newco’s initial focus will be on progressing the Cerro Moro project  through feasibility, project financing, development and into production, the company said.

Exeter’s mine development manager for Argentina, Eric Roth, will be appointed CEO and president of the new firm.

He has worked for companies that include BHP Billiton and Rio Tinto, and was more recently global exploration manager for AngloGold Ashanti.

“We intend for Cerro Moro to become a stepping stone for developing a mid-tier gold-silver producer with other development projects that may follow in the region,” Simpson said.

“We expect this will provide our shareholders with a long term investment opportunity, far beyond the scope of the Cerro Moro asset alone.”

The spin-out is conditional on shareholder and regulatory approvals, as well as Newco obtaining conditional approval for the listing of its common shares on a major stock exchange…read more at the Mining Weekly