Shareholders OK spinoff of Acadian Mining assetsShareholders OK spinoff of Acadian Mining assets
By BILL POWER Staff Reporter
Tue. Jun 10 - 4:32 AM
Acadian Mining Corp. will proceed with a plan to spin off its gold assets into a new company called Annapolis Gold Corp. after receiving shareholder approval Monday.
"We will dividend a share of Annapolis to the Acadian shareholders for every four shares of Acadian they hold," said William Felderhof, Acadian’s president and CEO.
Mr. Felderhof said the deal works out to about a 25 per cent dividend.
"That’s on a tax-neutral basis, so that’s quite attractive," he said.
The plan must be approved by the Nova Scotia Supreme Court and the Toronto Stock Exchange. Acadian wants to complete financing of the spinoff by June 27.
Shares in Acadian Mining have recently traded in the 57- to 59-cent range. But Mr. Felderhof said investors will be rewarded for their patience, thanks to the zinc and lead mining operation at Gays River.
He offered encouraging words to shareholders attending the annual general meeting in Halifax.
"We’re doing a good job at the mine," he said. "We’ve had some technical challenges, but the mine is going to do well.
"We’ve got a great crew out there. We’re keeping our costs under control, our throughput is ramping up and we still expect to hit our targets this year."
He attributed the low share value to a downturn in demand for zinc and lead but said there are many indicators that suggest prices for these metals will soon rebound.
The future looks bright for the spinoff company, mostly due to exceptional results from test drilling at Fifteen Mile Stream and Beaver Dam in the central part of the province.
"We’re looking at excellent drill intercepts, with great widths of continuously gold-mineralized material," he said.
Mr. Felderhof said Annapolis Gold will have four and possibly five mines in production in the near term. The spinoff company will be a completely separate corporate entity but will have the same management team as Acadian Mining.
( bpower@herald.ca)