Agreement to sell Interest in San LuisEsperanza Resources Corp. (TSX VENTURE: EPZ)(PINK SHEETS: ESPZF) ispleased to announce that it has reached an agreement to sell itsminority interest in the San Luis project, Peru, to Silver StandardResources Inc. (TSX: SS0)(NASDAQ: SSRI), the majority owner and operatorof San Luis. The transaction has been approved by the Boards ofDirectors of Esperanza and Silver Standard but remains subject tocustomary conditions, including the receipt of regulatory and otherrequired approvals.
Under the terms of the agreement, Esperanza will receive as consideration:
-- A payment of CDN$17 million; -- Return of the 6,459,600 shares ofEsperanza owned by Silver Standard; and -- A one percent netsmelter return royalty on all production.
Bill Pincus,Esperanza's President and CEO, said, "This is a good transaction all theway around. Esperanza is monetizing its minority interest in a non-coreasset. The cancellation of the Esperanza stock could remove up toapproximately 11 percent of the outstanding shares and result in agreater asset value per remaining share. The cash payment together withthe existing funds will result in a $27 million treasury for EPZ.
"Theproceeds will allow Esperanza to focus on the advancement of the CerroJumil, Mexico project, continue EPZ's involvement with Global MineralLtd. and its Strieborna, Slovakia deposit and move forward with its newexploration prospects in Peru and Mexico. With interests in twoadvance-stage projects, a full treasury and an exciting explorationportfolio, Esperanza is well positioned for future growth and creatingnew opportunities to further enhance shareholder value.
"It hasbeen a pleasure concluding this agreement with Silver Standard and wewish them the best success in developing San Luis."