Rox plans for nickel spinout

Rox Resources is planning to demerge two nickel assets into a new listed entity to focus on the development of its flagship Youanmi gold project near Mt Magnet.

The spinout, to be named Cannon Resources, will comprise Rox’s Fisher East nickel and Collurabbie gold-nickel projects, north of Kalgoorlie.

Rox managing director Alex Passmore said the demerger would allow a “crystal-clear focus” on developing the company’s 50 per cent-owned Youanmi project – one of four separate joint ventures with fellow Perth-based explorer Venus Metals Corporation.

Both companies had entered the Youanmi agreement in mid-2019.

Mr Passmore said Rox shareholders would still have exposure to the Fisher East and Collurabbie projects.

The deal is subject to shareholder approval, to be sought at a general meeting scheduled for May 17.

Rox has proposed to consolidate its shares on a one-for-15 basis, after which eligible shareholders are expected to receive one Cannon share for every 4.3 shares held in Rox. Both transactions are scheduled to occur on May 20 and May 25, respectively.

Meanwhile, the Cannon initial public offering is scheduled to open on April 27 and close on May 19.

Shares in Rox closed down 5 per cent to trade at 3.8 cents each.