Lumina Gold Corp. (TSX-V:LUM) (OTC:LUMAF) is pleased to announce that its board of directors has unanimously approved a strategic reorganization of its business. Pursuant to the Arrangement, all of Lumina’s concessions and properties, with the exception of the Cangrejos Gold-Copper Project will be spun out to Lumina shareholders through a newly incorporated company, Luminex Resources Corp. Shareholders of Lumina will receive shares in Luminex in proportion to their shareholdings in Lumina. There will be no change to shareholders’ existing interests in Lumina.
Marshall Koval, President & CEO of Lumina commented, “Management believes that splitting the Company’s assets will help illuminate the strategic regional concessions and partnerships that have been put in place over the last two years and support our medium-term goal of monetizing our most advanced assets at the appropriate time.”
It is intended that, as part of the Arrangement, Lumina’s current shareholders will receive shares of Luminex by way of a share exchange, pursuant to which each existing share of Lumina is exchanged for one “new” share of Lumina and 0.15 of a share of Luminex. Optionholders of Lumina will receive replacement options of Lumina and options of Luminex which are proportionate to, and reflective of, the terms of their existing options. The reorganization will be effected by way of a plan of arrangement under the Business Corporations Act (British Columbia), and must be approved by the Supreme Court of British Columbia and by the affirmative vote of 66 2/3% of Lumina’s shareholders in attendance at a shareholders’ meeting to be held on August 21, 2018. Lumina intends to apply for a listing of the shares of Luminex on the TSX Venture Exchange. Any such listing will be subject to Luminex fulfilling all of the requirements of the TSX-V. Following the completion of the Arrangement, Luminex will have approximately 39.6 million basic shares outstanding based on Lumina’s current share structure.
Once the Arrangement becomes effective, the result will be two separate, focused entities, one with a development stage asset and one with high quality exploration projects. The spin-out will provide new and existing shareholders more flexibility as to their specific investment strategy and risk profile.
The Company is undertaking the Arrangement in order to focus Lumina on the development of the Cangrejos Project. The spin-out transaction will allow the Company to raise the funding necessary to advance the Cangrejos Project without diluting shareholders’ interests in the exploration assets in its portfolio, and vice versa. The spin-out transaction should also maximize shareholder value by allowing the market to ascribe value to the Condor Project and the early-stage concessions that make up the First Quantum Minerals Ltd. and Anglo American PLC earn-in agreements independently of the Cangrejos Project. In addition to allowing the Company to continue to focus efforts on developing Cangrejos, the Company is confident that having a separately funded early exploration business will accelerate development of those exploration projects.
Luminex will be managed by Lumina’s current team of officers. Its board of directors will consist of three directors who currently sit on the Lumina Board, as well as two new directors who are independent of Lumina.
Additional details of the spin-out transaction will be included in an information circular to be mailed to shareholders of Lumina in July 2018 in connection with the Meeting. The Arrangement is expected to close on or about August 31, 2018.
About Lumina Gold
Lumina Gold Corp. is a Vancouver, Canada based precious and base metals exploration and development company focused on gold and copper projects in Ecuador. The Company’s Cangrejos Gold-Copper project is located in El Oro Province, southwest Ecuador, and its Condor Gold-Copper project is located in Zamora-Chinchipe Province, southeast Ecuador. The Company also holds a large and highly prospective land package in Ecuador consisting of 135 thousand hectares. The Company has an experienced management team with a successful track record of advancing and monetizing exploration projects.
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