Nevada King Gold (TSXV: NKG) is set to embark on a strategic reorganization of its operations. The reorganization is expected to see all but its flagship asset spun out to shareholders into a newly created company.
The transaction will enable Nevada King to solely focus on the advancement of the Atlanta Gold Mine project, while the firms massive land package, consisting of claims across 193,000 acres, will become the focus of the newly created company.
Referred to as SpinCo currently, the newly formed company will become the third largest mineral claim holder in Nevada, after that of Nevada Gold Mines and Kinross Gold. Still focused on the Battle Mountain Trend, SpinCo will have at least eight projects to focus on, including the Lewis and Iron Point projects. Also included among its assets will be a 3.0% NSR royalty on production from certain non-core claims around the Atlanta project, as well as on the core Bobcat claims that consist of the existing resource.
“Creating a standalone focused company holding Nevada King’s large portfolio of claims along the Battle Mountain trend will create an exciting growth-focused story with a dominant land position along one of the world’s most prolific gold mining trends. This project portfolio is nestled amongst some of North America’s most prominent current and former producing mines and has the potential to provide exceptional exploration upside and optionality from multiple properties,” commented Collin Kettell, CEO of Nevada King.
Timing of the spin out has not yet been identified, however the company has said that it will not initially be listed on public markets.
At the same time, Nevada King this morning identified that it will be conducting a private placement, which will see Kettell invest a further $2.0 million, while two major shareholders will invest $5.5 million, and a new strategic shareholder will invest $2.0 million. The financing, at $9.545 million in size, is considered fully subscribed, however pricing on the financing has not been revealed.
Nevada King last traded at $0.37 on the TSX Venture.
Information for this briefing was found via Sedar and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
