Teeshin, MacDonald plan to amalgamate

The directors of both firms have agreed to an amalgamation, subject to the establishment of an equitable share exchange ratio, as well as shareholder and regulatory approvals.

MacDonald Mines’ main asset is a 49% interest in Les Mines Gallen which owns a past-producing open pit zinc-silver mine in Dufresnoy Twp., Que. Although the mine was shut down several years ago it is reported to host existing reserves estimated at 765,000 tons grading 6.67% zinc accessible by open pit mining and 385,000 tons of underground reserves grading 7.19% zinc.

Deak International Resources is in the process of acquiring the remaining 51% in Les Mines Gallen from Noranda Inc. (TSE). Concerns over environmental liability and government permitting have been stumbling blocks in the Noranda- Deak deal.

According to Stafford Kelley, managing director of Teeshin, his company’s amalgamation with MacDonald Mines would probably involve a restructuring of any agreement with Deak. “We could restructure the agreement to form a straight joint venture,” he said.

The proposed merger between Teeshin and MacDonald has been slowed down somewhat by Teeshin’s ongoing legal battle over another property located in British Columbia.

Teeshin has been involved in an ongoing dispute with Total Energold Resources (TSE), and Canadian United Minerals (VSE), and other companies involving the Dome Mountain gold project near Smithers, B.C.

“The dispute (over Dome Mountain) has been occupying most of our available personnel, but we hope to have the issue resolved soon,” Kelley said.

Regarding the amalgamation of Teeshin and MacDonald Mines, he said the move is part of an over-all plan to build a “bigger and better” company which could eventually have major interests in two operating mines.

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