Denver — A restructured board of directors and a $5.5-million private placement are designed to boost the financial prospects of
The private placement is with Endeavor Financial and will consist of 11 million special warrants priced at 50 each. One special warrant can be exchanged for one share and one warrant, and each warrant entitles the holder to buy an additional share at 75 for two years.
Joining Wheaton’s board will be: Neil Woodyer, Endeavor’s founder and managing director; Frank Giustra, former chairman of Yorkton Securities and currently chairman of Lion’s Gate Entertainment; and Ian Telfer, former president of Vengold.
The three, plus existing directors Ian McDonald and Kerry Knoll, make up the company’s new 5-member board. John Kalmet and Peter Tredger will resign from the board, while retaining their management positions. Also departing are the company’s four independent directors: John Zigarlick, Laurence Curtis, James Geyer and Fred Davidson.
The private placement and board restructuring are expected to be approved by regulators by late April. The Endeavor group will then control a 25% stake in the company.
Wheaton River Chairman Ian McDonald says the move should enable the company to pursue worldwide projects more aggressively. Currently, Wheaton River is focused on properties in Canada and Central America, including the Bellavista gold project in Costa Rica, the Red Mountain gold project in British Columbia and the George Lake property in Nunavut.
The private placement also provides a platform for diving into opportunities for other metals, McDonald says.
At Bellavista, the company’s most advanced project, higher gold prices are still necessary before development can begin. Capital costs for the heap-leach operation should run US$28 million, not including preproduction costs, financing costs and working capital. At full production, it is expected to produce 60,000 oz. gold annually at a cash operating cost of US$179 per oz.
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