Black Hawk shares soar on reorganization news

Investors appear to be greeting the news of the planned re-activatio n and re-organization of Toronto- listed Black Hawk Mining with enthusiasm.

Over the past week, the share price has more than quadrupled to 55 cents and near press-time it was trading at about 61 cents .

Control of Black Hawk has been acquired by a group of four Toronto investors following the purchase of 42% interest from Denison Mines and Roman Corp.

The new team at Black Hawk plans to increase the company capitalization to 24.5 million shares from 4.3 million and also take control of a private company, Platinova, with interests in platinum, gold and industrial metals in Canada and in Greenland. Paul R. Little, one of the group of four and new president of Black Hawk tells The Northern Miner the group paid 10 cents a s hare for the 1.8 million shares purchased for a total of $180,000. Denison also received $100,000 to sell all of its rights under the Black Hawk 6.5% series A debentures to a private corporation controlled by the purchasers.

Upon the heels of this purchase, Black Hawk has approved plans to do a private placement of approximately one million shares at approximately 16 cents per share to raise $150,000 as working capital.

It has also agreed to a private placement of 7.2 million treasury shares at 21 cents per share to raise $1.5 million.

Black Hawk has also entered into an agreement in principle to acquire Platinova. After the closing of the private placement of 7.2 million shares, Black Hawk will acquire those shares together with the remaining Platinova shares through the issue of 12 million common shares to Platinova shareholders. At that point, Platinova will hold approximately 49% of the shares of Black Hawk.

Platinova will continue as a subsidiary of Black Hawk as its Greenland licences are not transferrable.

Platinova was founded by Robert Gannicott, Earl Curry and Grenville Thomas, all of whom are to be appointed directors of Black Hawk. Mr Gannicott will continue as president of Platinova and become executive vice-president of Black Hawk.

Among its current projects, Platinova is involved in a preliminary reconnissance program on a platinum bet in east Greenland with Vancouver-based Teck Corp. which holds a 55% interest in the permits and is operator of the project.

Approximately $150,000 has been spent on the property this year with $350,000 planned for next year for follow-up exploration to define drill targets.

Platinova also holds a 100% interest in a prospecting licence and two permits in southwest Greenland where it plans to spend $150,000 next year to follow up on platinum values.

Platinova’s other assets include platinum prospects near North Bay, Ont. and Shawinigan, Que. It also has a gold prospect near Timmins plus an wollastonite property near Marmora, Ont. Wollastonite is an industrial mineral used in the ceramics industry.

The above private placements and acquisition are both subject to regulatory and shareholder approvals.

Other members of the investor group now holding control of Black Hawk are John Thompson, Douglas A.C. Davis and Jacob Gornitzki.