Two Quebec-based junior companies are pursuing a merger, announcement of the move coming on the heels of a takeover proposal by a gold producer of one of the juniors.
Nova-Cogesco Resources (TSE) says its board of directors is in favor of a merger with MSV Resources (ME), which with a 22.1% interest in Nova-Cogesco is that firm’s major shareholder.
No details of the proposed merger have been released other than it would take place by way of a share exchange with independent evaluations sought on a fair ratio for the share exchange.
Recently making an offer to purchase between 30% and 60% of all the shares of Nova-Cogesco, at $1.50 per share, was Cambior Inc. (TSE). Cambior currently has a 3.8% interest in Nova-Cogesco.
The juniors are involved in a number of encouraging gold plays, including the Silidor, Norlartic and Eastmain in northern Quebec which are nearing the production stage. Officers of both companies forecast a possible total annual gold output of 60,000 oz from these properties for the merged company.
At the promising Silidor project in the Rouyn-Noranda area, Nova- Cogesco is a partner with Cambior and Noranda Inc. Reserves at the property stand at 4.8 million tons grading 0.19 oz gold per ton. At the Norlartic project northeast of Malartic, where reserves stand at 860,000 tons averaging 0.13 oz, Nova-Cogesco has a 30% interest.
Farther north, near James Bay, MSV earlier this year became the sole owner of the Eastmain project when it bought the 51% property interest of Placer Dome. Last reserve figure published for Eastmain is 1.12 million tons grading 0.45 oz.
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