To prevent dilution of its 30% net proceeds interest in the Gibraltar North property in British Columbia, Newcoast Silver Mines (VSE) will form a separate company and dividend it out to shareholders.
Shareholders of Newcoast will receive one share of a new company called Oakmont Ventures for every five shares held.
The transfer will allow Newcoast to acquire and develop a new project or business without diluting shareholders’ current interest in the Gibraltar North copper-molybdenum deposit.
The balance of the deposit, situated near McLeese Lake in the Cariboo district, is owned by Gibraltar Mines (TSE).
An evaluation of Gibraltar North last year deemed it uneconomic and a subsequent drop in the price of copper prompted Gibraltar to suspend operations at its adjacent Gibraltar open pit mine.
Gibraltar is studying the feasibility of expanding the Gibraltar mill to 57,000 from 38,000 tons per day.
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