Australia-focused gold miner Fosterville South Exploration (TSXV: FSX) is spinning off two gold projects to create a new company to be listed on the TSX Venture Exchange.
On Tuesday, the company’s board of directors unanimously approved a spin-out transaction whereby Fosterville will distribute shares of a new company named Leviathan Gold to its shareholders on a one-for-one basis.
Fosterville would retain ownership of all of its core properties — Lauriston (which adjoins Kirkland Lake’s Fosterville tenements), Golden Mountain, Providence and Walhalla Belt — while Leviathan would acquire the Avoca and Timor exploration licenses located in the state of Victoria.
Following the transaction, Leviathan, which will be led by Gold Standard Ventures (TSX: GSV) co-founder Luke Norman, will undertake an equity financing of at least C$5 million to fund the exploration and development of the Avoca and Timor projects.
Closing of the spin-out transaction is subject to, among other things, Fosterville shareholder approval, court approval, regulatory approvals, completion of the financing by Leviathan and TSX Venture Exchange approval, including its approval of the listing of Leviathan common shares on the exchange.
Fosterville’s stock jumped by as much as 29.8% during Tuesday’s trading session to an all-time high of C$4.35. The company has a market capitalization of approximately C$146.4 million.