Vizsla Silver (TSXV: VZLA) has seen shareholders approve the spinout of Vizsla Royalties Corp from the company at a special meeting of shareholders.
The principal asset of the royalties company will be a 2% net smelt returns royalty on Vizsla’s Panuco project in Mexico after it exercises a buyback right on the asset. The firm will be funded via a $3.5 million loan from Vizsla Silver, as well as a private placement that is expected to raise proceeds of $3.0 million.
Shareholders of record as of the close of business on June 21, 2024, will receive securities in Vizsla Royalties, with shareholders to receive one share and one warrant of Vizsla Royalties for every three shares of Vizsla Silver they hold.
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READ: Vizsla Silver Acquires New Project In Mexico Adjacent To Panuco
Each full warrant contains an exercise price of $0.05 and is valid for a period of 120 days after the listing of Vizsla Royalties on the TSX Venture, or until December 31, 2025, whichever is earlier.
Vizsla shareholders are expected to hold 45% of the spinout on a post-transaction basis, with Vizsla Silver retaining the balance.
A consolidation of Vizsla Royalties shares meanwhile is expected to happen in the near term, with one new post-consolidation share to be issued for every ten pre-consolidation shares of the firm.
Vizsla Silver last traded at $2.25 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.
