Dynacor to roll over gold assets

Dynacor Mines (DYN-T) plans to spin off its gold assets and the market likes the call.

The Montreal-based company announced that while it will continue to focus on developing its tungsten production at the Pasto Bueno mine in Peru, it will put all of its current gold assets into the new company.

Dynacor’s gold assets include its Acari mine and the Tumipampa and Casaden gold exploration properties — all of which are in Peru as well.

The market — which generally gives premiums to pure-plays — applauded the announcement by giving Dynacor shares a healthy 9% or 6 bump to 70 on roughly 600,000 shares traded.

In 2005 the Acari mine produced 14,000 oz. of gold for an operating profit of roughly $1 million. In 2006 mill capacity was increased to 100 tonnes per day from 60 tonnes, and the company plans to move up to 130 tonnes in 2007.

At this stage, the company says the plan is to domicile the new company in Canada and list its shares on a recognizable Canadian stock exchange.

While there is currently not a name for the new company, Dynacor did say that its current directors and officers will be the first directors and officers of the new company.

The company says the spin-off would be in the form of a pro-rata distribution of common stock of the new company, which is expected to be available on a tax neutral basis to the majority of Dynacor shareholders.