Trading Symbol: ADA:TSX
HALIFAX, Feb. 8 /CNW/ - Acadian Mining Corporation ("Corporation" or "Acadian") (TSX: ADA) is pleased to announce that it has signed a letter of intent with
Selwyn Resources Ltd. ("Selwyn") whereby Selwyn would acquire the zinc and lead assets of Acadian for
a cash consideration of $10 million.
The sale will be consummated by Selwyn acquiring all of the issued and
outstanding shares of ScoZinc Limited ("ScoZinc") which holds all of the assets associated with the Scotia Mine located
in Nova Scotia ("Acquisition"). Selwyn and Acadian have agreed to an exclusive period expiring on
February 14, 2011 to complete a binding letter agreement for the
The sale price for ScoZinc is $10 million less certain deductions
including those related to increased bonding requirements for an
amended reclamation and closure plan for the Scotia Mine. Upon
completion of the Acquisition, Selwyn will own the mine-mill complex
and an extensive mineral claims package.
The Acquisition is subject to completion of formal documentation,
regulatory approval and the achievement of certain conditions prior to
closing, including Selwyn being satisfied with the results of an
environmental audit by an independent consulting group and Selwyn
receiving an independent NI 43-101 Technical Report confirming the
Mineral Resources reported by ScoZinc. The parties have agreed to act
expeditiously and in good faith in finalizing and executing a binding
letter agreement and, thereafter, a more formal agreement of purchase
and sale. Acadian has agreed to the payment of a break fee in the
amount of $1.5 million if it receives and accepts an unsolicited
superior proposal. During the period Acadian has agreed to negotiate
exclusively with Selwyn.
Grant Ewing, President and C.E.O., stated, "Acadian is very pleased to
enter into this transaction with Selwyn Resources. Following the sale
of the zinc and lead interests, Acadian will be a well-financed and
focused gold exploration and development company, with an excellent
portfolio of projects in a highly prospective and under-developed gold
region. Selwyn has an experienced management team and is committed to
the zinc business, and is thus ideally suited to bring the Scotia Mine
back into commercial production ".
Gold Exploration Update
Over the last several months, Acadian has been prioritizing and
performing detailed planning and budgeting in preparation for an active
gold exploration program that is slated to commence in the near future.
Acadian has numerous high quality gold exploration projects in Nova
Scotia that the Corporation considers highly prospective for new
Acadian's 2011 exploration activities will focus on its two advanced
stage gold projects; Fifteen Mile Stream and Beaver Dam, both of which
have excellent potential to be developed as bulk tonnage open-pit
mines. Significant resources have been identified at the projects, and
the exploration programs are designed to increase both the scale and
quality of the resources. Acadian also plans to conduct exploration
programs at its Golden Seal and FMS Trend projects, among others, as
part of a comprehensive 2011 program.
A regional till sampling program is underway to aid in delineating
target areas along the FMS Gold Trend. The till sampling data will be
assessed in conjunction with the data from a regional airborne survey
conducted last year to fine tune the gold target selection process. The
FMS Trend is an extensive and highly under explored region that is
viewed as having excellent potential to host new discoveries. Most of
the important potentially bulk mineable gold deposits in Nova Scotia
occur on this trend, and Acadian is the largest owner of exploration
claims in the region.
Richard Horne, M.Sc., P.Geo., Chief Geologist of Acadian, is a Qualified
Person in compliance with National Instrument 43-101 and has reviewed
and approved the technical information in this news release.
About the Corporation
Acadian is a Halifax, Nova Scotia, Canada based company with five
advanced gold projects, all of which host National Instrument 43-101
compliant resources. The Corporation also owns barite properties on
Cape Breton Island, Nova Scotia and the Scotia Mine, which is currently
on care and maintenance. Acadian's primary focus is centered on
exploration and development of its gold deposits in Atlantic Canada.
For additional information on Acadian's properties and activities,
please visit our web site at: www.acadianmining.com.
SOURCE ACADIAN MINING CORPORATION
For further information:
Grant Ewing, President and Chief Executive Officer
(902) 444-7779 Toll Free: (877) 444-7774
Halifax, Nova Scotia
No regulatory authority has approved or disapproved the contents of this news release.