The boards of directors of three struggling juniors, Campbell Resources (CCH-T), MSV Resources (MSV-T) and GeoNova Resources (GNE-M), have agreed on the details of a merger via a court-approved plan of arrangement.
Under the deal, MSV will amalgamate with a wholly owned Campbell subsidiary. MSV shareholders will receive one Campbell share for 4.1 MSV shares. GeoNova shareholders will get one Campbell share for 10 GeoNova shares.
The transaction is subject to the approval of the court and the shareholders.
The companies say the merger will result in annual savings of about $4.5 million and will help ensure that their Chibougamau operations remain profitable at current gold and copper prices.
Campbell owns the suspended Joe Mann underground gold mine, which is located south of Chibougamau. The company says operations will resume following development and exploration work below the 2,500-ft. level. Resources at Joe Mann stand at 1.7 million tons grading 0.326 oz. gold and 0.28% copper per ton.
MSV operates (and owns a 16% interest in) the Copper Rand 5000 project near Chibougamau. Resources there are pegged at 1.9 million tons grading 1.55% copper and 0.097 oz. gold per ton.
MSV has concluded $45 million in financing for the project and says work will begin imminently. The company holds other properties in Quebec, including Corner Bay (copper) and Eastmain (gold).
GeoNova holds interests in 17 properties. Most are in the Lebel-sur-Quevillon and Chibougamau areas.
The company’s Discovery project hosts inferred resources of 2.3 million tons grading 0.15 oz. gold. Its Chevrier project (near Joe Mann) has a resource of 3.9 million tons grading 0.15 oz. gold.
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