Spinning Out Peruvian Assets
Auryn Resources Inc. (TSX: AUG, NYSE: AUG) has entered into a definitive agreement with Eastmain Resources Inc. (TSX: ER) pursuant to which Auryn will acquire all of the issued and outstanding shares of Eastmain.
The deal will be finalised immediately following a spin out of Auryn’s Peruvian projects to Auryn shareholders and completion of a concurrent financing. The Transaction will create Fury Gold Mines Limited and two independent spin-out entities which will hold Auryn’s Peruvian projects.
Fury Gold is expected to remain listed on the TSX and NYSE American exchanges, and will be led by new President and CEO, Mike Timmins,
The assumed value of the spinoff companies is C$121 million.
The two new SpinCo companies – SpinCo Sombrero will consist of the Sombrero project while SpinCo Curibaya will consist of the Curibaya and Huilacollo projects.
Fury Gold is planning to commence a 50,000m drill programme at Eau Claire shortly after closing of the transaction.
Executive Chairman and Auryn Director, Ivan Bebek, said the combination of Eastmain’s portfolio with Auryn’s Canadian projects will create one Canadian-focused gold exploration and development company.
“Auryn has spent a considerable amount of time and money developing a tier-one exploration portfolio,” Mr Bebek.
“The splitting of Auryn should unlock considerable value for Auryn shareholders, and importantly, results in three, commodity-specific exploration companies well-positioned for major discoveries as we head into the bull market.
“Fury Gold will combine the high-grade gold projects; Committee Bay in Nunavut, Homestake Ridge in B.C and Eau Claire in Quebec, to offer investors a robust Canadian, gold-focused exploration and development company. We are very excited to welcome Mike Timmins as CEO of this new endeavour and believe that his impressive pedigree combined with our world-class technical team will successfully execute on our goal of creating significant shareholder value through discovery and development in all three jurisdictions.
“Sombrero and Curibaya are premier exploration targets in Peru and we are in the final phases of permitting for inaugural drill programs. We plan to significantly enhance the value of these entities over the coming months, prior to their relisting, through achieving drill permits, completing additional community agreements to provide access to more areas, identifying additional high priority targets and further value-added acquisitions.”