09/02/2007 - 10:11

Moly divests gold assets to Cortona in $9m deal

09/02/2007 - 10:11

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West Perth-based Moly Mines Ltd will sell its New South Wales gold assets, held though subsidiary Big Island Mining Ltd, to West Leederville's Cortona Resources Ltd in a cash and scrip issue, the company announced today.

Moly divests gold assets to Cortona in $9m deal

West Perth-based Moly Mines Ltd will sell its New South Wales gold assets, held though subsidiary Big Island Mining Ltd, to West Leederville's Cortona Resources Ltd in a cash and scrip issue, the company announced today.

The company will receive $5 million in the first stage of the deal, and will receive an additional $4 million after the successful delineation of a total of 1 million ounces of JORC-compliant measured resources or a decision is made to mine.

Moly will also become Cortona's major shareholder under the deal, which will see the company receive 12 million Cortona shares, eight million options exerciseable at 35c expiring two years from date of issue, and a further eight million royalty options exercisable at 50c.

A Moly statement said the sale would sharpen the company's focus on its Spinifex Ridge Molybdenum project in the Pilbara, but would enable it to retain exposure to the NSW assets through its Cortona shareholding.

The sale adds to Cortona's 12 tenements in five NSW projects, with company managing director Peter van Der Borgh saying the acquisition would see the company become a major Australian gold explorer.

Cortona shares rose 10 cents or 38 per cent to 36 cents before pulling back to 30 cents, a gain of four cents, at close of trade today.

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