St Andrew grabs a third of United Tex-Sol

Junior St Andrew Goldfields (SAS-T) has acquired a 33% stake in United Tex-Sol Mines (UTX.a-V).

In exchange for more than 4.4 million of its own shares, at a deemed price of 30.5 apiece, St Andrew bought nearly 7.9 million of UTX’s class A shares, or about 33% of the company’s outstanding shares.

St Andrew says the acquisition is for investment purposes only, and that it reserves the right to acquire additional shares depending on market conditions.

UTX owns the 12.5-sq.-km Clavos gold property near Timmins, Ont., just 9.6 km north of St Andrew’s Stock mill, about 60 km east of the town.

Previous drilling by Kinross Gold (K-T) on the property confirmed the presence of high-grade gold mineralization in shears and quartz veins along the Pipestone fault. Kinross’s option to acquire the property expired late last year.

A mineral resource estimate by Roscoe Postle Associates earlier this year pegged indicated resources at 331,000 tonnes grading 10.4 grams gold per tonne. Another 205,000 tonnes running 13.4 grams gold are classified as inferred resources. The estimate employs a cutoff grade of 6.5 grams gold and a cutting grade of 60 grams gold for high assay values.

The latest deal adds to St Andrew’s growing portfolio in the Timmins area. In April, the company acquired a 30.7% stake in Royal Victoria Minerals (RVM-V) by subscribing to a private placement of 2 million RVM units. Each unit included one share plus a share purchase warrant that entitles the holder to buy one share for 18 for 2 years. Total consideration paid by St Andrew was $270,000, and the company is now the major shareholder of Royal Victoria.

Royal Victoria’s Key asset is the 4.3-sq.-km Golden Reward project in Garrison, Michaud and Guibord Townships east of Timmins. The project lies along the Porcupine-Destor fault zone.

St Andrew has also completed a private placement of 13.5 million units for gross proceeds of about $4 million. One unit comprises one share plus half a share purchase warrant. One whole warrant allows the holder to buy one share for 40 until June 13, 2003.