Queenston, HSK merger approved (January 08, 1990)

The proposed merger of Queenston Gold Mines (TSE) and affiliate HSK Minerals (TSE) was approved by shareholders of both companies recently at a special meeting in Toronto.

Trading on the Toronto Stock Exchange as Queenston Mining (TSE), the amalgamated company is expected to have 14 million shares issued, $18 million worth of assets (including $1.7 million in working capital) and no debt.

Under the merger, shareholders of Queenston Gold Mines will receive one Queenston Mining common share for each share held, while HSK shareholders can swap their shares for 0.434 of a common share of the new company.

Before the merger became effective Jan 2, HSK was Queenston Gold Mines’ largest shareholder with 11.2 million shares, representing a 35.6% interest. HSK was in turn controlled by Joutel Resources (TSE) which is scheduled to hold just over three million shares or 21.4% of the amalgamated company.

While earning revenues from LAC Minerals’ (TSE) Macassa gold mine and McBean mill near Kirkland Lake, Ont., Queenston Mining’s major focus in 1990 will be nine gold projects in the Kirkland Lake camp.

According to Chairman Hugh Harbinson, a sustained gold price above $425(US) per oz could lead to an early production decision at Queenston’s 35% owned Anoki project.

Inco Exploration, a unit of Toronto-based Inco Ltd. (TSE), holds a 65% stake in the Anoki deposit where mineable reserves stand at 650,000 tons of grade 0.136 oz gold per ton.

Queenston is also expecting partner American Barrick Resources (TSE) to extract a 30,000-ton bulk sample from the Pandora mine property before running the sample through Barrick’s nearby Camflo mill.

Queenston is carried for 25% through to a positive feasibility decision at Pandora where drill-indicated reserves stand at 2.3 million tons grading 0.13 oz in three zones.

The proposed merger of Queenston Gold Mines (TSE) and affiliate HSK Minerals (TSE) was approved by shareholders of both companies recently at a special meeting in Toronto.

Trading on the Toronto Stock Exchange as Queenston Mining (TSE), the amalgamated company is expected to have 14 million shares issued, $18 million worth of assets (including $1.7 million in working capital) and no debt.