MINING MARKETS & INVESTMENT NEWS — Prospex approves Semafo merger

At their annual meeting, shareholders of Denver-based Prospex Mining (PRM-V) approved of a merger with Montreal-based Semafo (SMF-T.

UNDER THE MERGER PLAN, PROSPEX WILL BECOME A WHOLLY OWNED SUBSIDIARY OF SEMAFO, WITH PROSPEX SHAREHOLDERS RECEIVING ONE SEMAFO SHARE FOR EVERY 10 PROSPEX SHARES HELD. ONCE THE TRANSACTION IS COMPLETED, PROSPEX SHAREHOLDERS WILL HAVE RECEIVED 3.3 MILLION SEMAFO SHARES OUT OF A TOTAL OF 36.1 ISSUED AND OUTSTANDING SEMAFO SHARES.

PROSPEX PRESIDENT DAVID NETHERWAY AND CHAIRMAN JAMES ASKEW ARE DUE TO JOIN SEMAFO’S BOARD, AND NETHERWAY WILL HEAD SEMAFO’S OPERATIONS IN WEST AFRICA.

BOTH COMPANIES HAVE GOLD EXPLORATION PROJECTS IN WEST AFRICA, BUT SEMAFO IS THE MORE ADVANCED OF THE PAIR, WITH TWO PROJECTS AT THE PREFEASIBILITY STAGE AND $21 MILLION IN CASH AND INVESTMENTS.

IN APRIL, SEMAFO AND RIO TINTO (RTP-N) agreed to form a joint venture to explore the Mont Kakoulima nickel project in Guinea. Rio Tinto may earn interests ranging from 70% to 100% by performing exploration and development work. Currently, Semafo and Afcan Mining (AFK-M) each hold a half-interest in Kakoulima.

In other news, Semafo has encountered high-grade gold mineralization in several trenches at its Mana property in western Burkina Faso. Results ranged from 5.19 to 12.67 grams gold per tonne over trench widths of 1.5-8.8 metres.