PERTH (miningweekly.com) – ASX-listed TNG has called a shareholder meeting for May 20 to vote on the proposed demerger of its noncore portfolio of zinc, copper and other base metals assets in the Northern Territory.
The proposed spin-off, which would be called Todd River Resources, would see TNG emerge with a 20% cornerstone stake in the new company. TNG shareholders would hold 80% of the company through an in-specie distribution.
The vanadium-focused TNG said that the spin-off would allow the company to concentrate on the development of its flagship Mount Peake project, and to create a separate entity to focus on the future development of the Northern Territory base metals assets.
The spin-off would also provide a separate funding channel for Todd River, allowing TNG to conserve its cash resource while also making it easier to raise equity to fund the Northern Territory assets.
TNG said on Thursday that the value of the Northern Territory assets was currently not recognised in TNG’s share price, with MD Paul Burton saying that the time had come to separate and transfer the assets into an independent company with specific commodity and management focus.
“The spin-out is considered to be an opportunity for shareholders to realise maximum value from the base metal assets, as it will allow the company to divest of these assets, which it considers noncore to its strategic objectives, while focusing on its flagship Mount Peake project.”
The Northern Territory base metal assets cover a number of projects, including the Mount Hardy copper project, the Manbarrum zinc/lead/silver project, the McArthur and Sandover copper projects, and a joint venture agreement with Western Desert Resources over copper, copper/gold, and nickel mineralisation.