Subiaco-based diamond explorer Elkedra Diamonds NL will spin-off its uranium and base metal prospects in its Georgina Basin project in the Northern Territory, after making an in-prinicple decision today.
The full text of a company announcement is pasted below
Elkedra Diamonds NL is pleased to announce that it has made an in principle decision to spin-off its uranium and base metal prospects in the Georgina Basin in Australia into a new company. It is then proposed that the new company will complete an initial public offering and apply for listing on the Australian Stock Exchange.
Elkedra is focussed primarily on growing its successful diamond production and exploration business which comprises the company's Chapada diamond mine in Brazil and exploration tenements in Brazil and Australian. Elkedra's directors consider the proposed spin-off of its non-diamond exploration assets is in the best interests of its shareholders as the new company will be able to focus its management time and its funds to advancing the assets through appropriate exploration programmes.
The new company's tenement package is expected to comprise approximately 8,000 km2, nearly all of which is located in the Northern Territory. Work undertaken by Elkedra while exploring for diamonds in the Georgina Basin since 2002 and other available exploration data has confirmed that these tenements contain highly prospective uranium and base metal targets which warrant further exploration. Elkedra will retain the diamond rights on the tenements it transfers to the new company.
Elkedra plans to hold a substantial investment in the new company which, subject to ASX and shareholder approval, it intends to distribute in specie to Elkedra shareholders within 12 months of a successful float.
Elkedra is currently obtaining the commercial and legal advice necessary as a prerequisite to achieving this objective and will make further announcements as the precise details of the proposed spin-off are finalised.
