Colin Kettel Loves Spin outs Parker just bought another huge chunk of NKG for his joint actors .
NKG was spun out of Pali.
Now, NKG is spinning out its exploration assets other than the Atlanta mining claims to shareholders as a new publicly listed company.
Coincidentally ,NKG announced successful mettalurgucal results
Spin outs are used to unlock hidden asset value.
Queensway South and Kingsway comes to mind......Spun out via acquisition of Maritime whose gold mills are essential for NFG to begin early mining while adding Maritime's early production of HammerDown mine with Spinco to shareholders as the exploration arm of NFG.
Such a value maximization move would see NFG market cap held by shareholders increase by 3-4 times .
And Colin loves spinouts.
Nevada King to spin out non-Atlanta claims
2024-02-12 16:35 ET - News Release
Mr. Collin Kettell reports
NEVADA KING ANNOUNCES SPIN-OUT OF NON-ATLANTA CLAIMS PORTFOLIO AND FULLY ALLOCATED $9.75-MILLION NON-BROKERED PRIVATE PLACEMENT
Nevada King Gold Corp.'s board of directors has unanimously approved plans for a strategic reorganization of its business pursuant to which all of the company's concessions and properties with the exception of the Atlanta gold mine project will be spun out to Nevada King shareholders through a newly incorporated company (SpinCo). In connection with the spinout, Nevada King proposes to also grant to SpinCo a 3-per-cent royalty on all production from certain portions of Atlanta, including the Atlanta resource area and non-core claims surrounding the Atlanta gold mine project.
The company is also proceeding with a non-brokered private placement financing of 27,857,143 common shares of the company at a price of 35 cents per common share for aggregate gross proceeds of $9.75-million. The non-brokered private placement is fully allocated to insiders, existing shareholders and a new strategic shareholder of the company. Proceeds of the non-brokered private placement will be used to advance the Atlanta gold mine project and for working capital purposes of Nevada King.
Highlights:
- The spinout will provide investors with an ownership stake in two separate specialized companies. Nevada King will continue to focus exclusively on the advancement of the Atlanta gold mine project, while the newly created SpinCo will focus on advancing its foothold as the third-largest mineral claim holder in the state of Nevada, behind Nevada Gold Mines (Barrick/Newmont) and Kinross Gold. SpinCo will control over 193,000 acres (9,682 claims) along the Battle Mountain trend with key project areas hosting significant historical exploration work and possessing untested discovery potential. These project areas include Iron Point, Buffalo Valley, Lewis, Horse Mountain-Mill Creek, Hilltop South, Carico Lake, Kobeh Valley and Pancake South.
- Company founder and chief executive officer Collin Kettell is subscribing for $2-million of the non-brokered private placement, while other members of management and the board of directors are also participating.
- Two significant shareholders of the company are subscribing for $4.2-million and $1,345,000 of the non-brokered private placement, respectively. A new strategic shareholder to the company is subscribing for $2-million. Between participation of the new strategic shareholder, as well as management and significant shareholders, the non-brokered private placement is fully allocated.
"We are pleased to announce these two exciting opportunities for the company. Creating a stand-alone 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," Mr. Kettell, CEO of Nevada King, stated. "At the same time, the fully allocated non-brokered private placement, which is priced at market and without a warrant, will allow Nevada King to fast-track drilling at Atlanta, where we have continually intersected high-grade oxide results over significant thicknesses. We will be creating value for shareholders on two fronts now, with SpinCo providing exposure to significant exploration potential while Nevada King continues to develop its flagship Atlanta gold mine project.
"Finally, I would like to provide a special thank you to our dedicated and growing group of significant shareholders whose support and long-term vision for Nevada King has allowed us to accelerate the advancement of Atlanta despite difficult equity conditions for the gold exploration sector."
Spinout
The spinout will be completed as part of a strategic reorganization to unlock value in Nevada King's large portfolio of mineral claims in the state of Nevada. The target areas along the Battle Mountain trend to be held by SpinCo include the company's Lewis, Horse Mountain-Mill Creek and Iron Point projects. Nevada King will also grant SpinCo a net smelter return (NSR) royalty in the amount of 3 per cent from all production from certain non-core Atlanta claims surrounding Atlanta, as well as a 3-per-cent NSR royalty on the core Bobcat claims that cover the existing resource zone. The 3-per-cent NSR royalty on the Bobcat claims will take effect upon fulfilling the existing royalty on the Bobcat claims which is a 3-per-cent royalty capped at the first 4,000 ounces of gold equivalent production.
It is proposed that the spinout will proceed by way of a statutory plan of arrangement pursuant to the Business Corporations Act (British Columbia). Common shares of SpinCo will be distributed to shareholders of Nevada King in proportion to their shareholdings of Nevada King. There will be no change in Nevada King shareholders' holdings in the company as a result of the spinout.
Completion of the proposed spinout will be subject to finalizing the terms of a definitive arrangement agreement to be entered into between Nevada King and SpinCo, as well as the approval of the Nevada King shareholders, and the approvals of the British Columbia Supreme Court and the TSX Venture Exchange.
SpinCo will not initially be listed on a public stock exchange but will operate as a reporting issuer.
Further details of the spinout will be provided as the transaction progresses. Timing of the spinout will be based on prevailing market conditions. The particulars of the spinout are not yet final and shareholders are cautioned that there can be no assurance that the spinout will be completed on the terms described herein or at all.