Trade Winds sells Block ASUBSIDIARY OF CANADIAN BANK TO INVEST IN TRADE WINDS AND TRADE WINDS TO SELL ITS DETOUR LAKE ASSETS TO NEW COMPANY TO BE FORMED
12/7/2007
Toronto, ON December 07, 2007
FSC / Press Release
SUBSIDIARY OF CANADIAN BANK TO INVEST IN TRADE WINDS AND TRADE WINDS TO SELL ITS DETOUR LAKE ASSETS TO NEW COMPANY TO BE FORMED
Not for Distribution to U.S. Newswire Services or for Dissemination in the United States
Toronto, Ontario CANADA, December 07, 2007 /FSC/ - Trade Winds Ventures Inc. (TSX - VX: TWD, FWB: TVR, OTCBB_Pink_Sheets: TWDIF), ("Trade Winds" or the "Company") is pleased to announce that, subject to the conditions set out below, its Detour Lake properties (all Detour assets including Block A, operated as a 50/50 joint venture with Detour Gold Corp., and its 100% owned Gowest property) will be transferred to a new company to be formed, headquartered in Toronto, Ontario ("Newco"). Trade Winds expects to receive consideration of approximately 50% of the common shares of Newco, which is anticipated to be financed with a minimum $15,000,000 private placement followed by an Initial Public Offering expected later in 2008. In addition, Newco expects to have the option to fund Trade Winds' expenditures related to the Detour Lake properties from the earlier of the completion of the transaction or May 31, 2008. Newco intends to conduct an aggressive exploration program at the Detour Lake project during 2008 and 2009 with the objective of increasing the current resource and work toward initiating a feasibility study. RBC Dominion Securities Inc. has the option to provide up to 100% of the funding for Newco.
Ian Lambert, President and CEO of Trade Winds, stated: "With an NI 43-101 compliant gold resource of 804,321 indicated ounces of gold and 1,499,552 inferred ounces of gold, the Detour Lake Block A and Gowest properties are now ready for the next level in the mine development life cycle. We believe that the logical next step is to bring in new exploration management expertise and the necessary funding going forward, and augmenting that team with the experience that we have gained over the last several years of exploration at Detour Lake." Mr. Lambert added: "This proposed transaction is consistent with Trade Winds' partnership and spin-out strategies which are being designed to improve the identification and valuation of each specific Trade Winds' property, enabling Trade Winds to separately finance and develop its various assets, selectively reducing stock dilution. We believe our shareholders will realize greater upside value through a 50% equity ownership in Newco than is currently being recognized at this point in time."
General Terms of the Agreement
The transaction is subject to:
1. Regulatory approvals, including acceptance by the TSX Venture Exchange ("TSX-V");
2. Approval from the shareholders of Trade Winds by April 30, 2008;
3. Completion by Newco of a minimum $15 million private placement within 45 business days of the date of the agreement; and
4. Other customary conditions.
If Newco fails to close the private placement within the required time or if shareholder approval is not obtained by Trade Winds, Trade Winds shall retain its interest in the Detour Lake Block A and Gowest properties.
Upon closing of the transaction, Trade Winds will have two representatives on Newco's board of directors, which shall consist of at least five members. Trade Winds expects to call a special meeting of its shareholders to seek approval for the transaction in April, 2008. Octagon Capital Corporation is acting as advisor in this transaction