Integra diffuses proxy battle between Columbus, Eastmain

VANCOUVER — Integra Gold (TSXV: ICG; US-OTC: ICGQF) is making a $6-million strategic equity investment for a 9.9% stake in Quebec-focused gold explorer Eastmain Resources (TSX: ER), and is shaking up Eastmain’s management team.

The move effectively ends a brewing proxy battle between Eastmain and its disgruntled shareholder Columbus Gold (TSX: CGT; US-OTC: CBGDF), which had been trying to place five new directors to Eastmain’s board after picking up 2.7 million Eastmain shares in early April. Columbus argued that Eastmain had lost sight of how to unlock value at its Clearwater gold property, 200 km east of James Bay, Que.

As part of the latest transaction, Integra’s president and CEO Stephen de Jong, and chairman George Salamis, will be appointed to Eastmain’s new slate of directors, whereas Donald J. Robinson, Eastmain’s president and CEO, will step down and serve as company advisor.

Other nominees for election at Eastmain’s annual meeting on April 29 include: Claude Lemasson, former general manager of Goldcorp (TSX: G; NYSE: GG) for its Éléonore project; Laurence Curtis; Michael Hoffman; Blair Schultz; and Timo Jauristo, former executive vice-president of corporate development of Goldcorp.

“The funds we’re going to inject — alongside a private placement and new board members — give Eastmain the finances, mentality and resources to push the project forward.”
Stephen de Jong
president & CEO, Integra Gold

“What we’ve done is no different from what Columbus was proposing,” Salamis tells The Northern Miner during a phone interview, commenting that Robinson has done an “exceptional” job at advancing the project to its current stage.

De Jong adds that “the funds we’re going to inject — alongside a private placement and new board members — give Eastmain the finances, mentality and resources to push the project forward.”

Integra is advancing its Lamaque South project in Quebec’s prolific Val-d’Or district, which includes the shear-hosted Triangle gold deposit.

De Jong says that while this is a “great opportunity to get some of our expertise involved. We’re not distracting our own team, time and resources away from our focus at Triangle.”

He notes this is the first position Integra has taken in another junior explorer.

Eastmain’s 201 sq. km Clearwater property includes the Eau Claire gold deposit, a 1.8 km long, 100-metre wide and 900-metre deep vein-hosted mineralized body along the edges of a dyke swarm.

Open-pittable, measured and indicated resources stand at 7 million tonnes at 4.05 grams gold for 885,000 contained oz. gold, whereas underground resources measure 428,000 tonnes of 4.78 grams gold for 66,000 tonnes gold, using a 2.5-gram-gold cut-off.

Inferred resources add 5.1 million tonnes at 3.88 grams gold for 633,000 oz. gold.

Salamis says Integra always had “its eyes on the property” but accelerated the “amiable” alliance because of the Columbus overture.

“Everything we do is governed by the geological potential in the Abitibi,” he says. “What we see at Eau Claire looks a lot like how Sigma-Lamaque looked like when we started tackling it a couple years ago.”

The camp at Eastmain Resources’ Clearwater gold property in Quebec.  Credit: Eastmain Resources.

Interim-CEO of Eastmain Laurence Curtis says in a phone interview that Integra’s new involvement shows “we can initiate change and get it done in the time required.

“Don Robinson is a discoverer and developer of this project … and we plan on taking it to the next level with a new team,” he says. “We realized all along that the project was transitioning to a more advanced stage … and there was mutual ground for both companies to create a positive outcome.”

Columbus withdrew its advance on Eastmain soon after Integra announced buying shares and changing the company’s board.

In a press release, Columbus congratulates Eastmain for “taking swift action to address the concerns of Columbus and other concerned shareholders.”

CEO Robert Giustra said that “it is a victory for shareholders everywhere when blockages are removed, so that investments can be set on course to realizing their full potential.”

Eastmain closed a private placement on April 11 for a total $5.1-million, with subscribers including an unspecified Eastmain director. Integra’s tranche could close after Eastmain’s annual meeting.

Eastmain has traded in a 52-week range of 28¢ to 50¢ per share, and closed at 46¢ at press time. The company has 133.9 million shares outstanding for a $62-million market capitalization.

Integra has traded in a 52-week range of 22¢ to 58¢ per share, and last closed at 53¢. The company has 400 shares outstanding for a $216-million market capitalization.

Columbus shares have traded within a 52-week price range of 31¢ to 47¢ per share, and last closed at 44¢ per share. The company has 141.7 million shares outstanding for a $65.2-million market capitalization.