NovaGold plans takeover of Etruscan Enterprises

Continuing on the acquisition trend, NovaGold Resources (TSE) is planning a takeover of Etruscan Enterprises (VSE), an exploration company with two properties in the Northwest Territories. As part of the deal, Etruscan shareholders will receive one NovaGold share for every 1.2 Etruscan shares. The takeover is subject to shareholder acceptance of at least 51% of Etruscan shares and regulatory approval, but Etruscan President R.J. MacNeill says he is in favor of the bid.

NovaGold has already secured agreements from some principal Etruscan shareholders who will exchange 42% of the Etruscan shares outstanding. Combined with NovaGold’s current holdings of Etruscan, these shares exceed the 51% required to complete the offer.

Etruscan has two major assets: a 46.4% interest in the Hackett River property and a 60% interest in the Indian Lake property, both in the Northwest Territories. According to NovaGold, the Hackett River property contains 17 million tons of polymetallic ore-grade material in the proven-probable category, including one zone of 6.1 million tons grading 0.02 oz. gold, 5.54 oz. silver, 0.38% copper, 1.24% lead and 11.22% zinc. Cominco (TSE) owns the remaining 53.6% of the property and has the option to increase its interest to 60% by spending about $1.8 million by the end of 1999.

Last year’s exploration on the 11,000-acre Indian Lake property, 124 miles northwest of Yellowknife, N.W.T., outlined seven areas with significant precious and base metal values. The property has been recommended for detailed geophysical surveying and diamond drilling.