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(Alliance News) - SolGold PLC on Friday said it expects its planned acquisition of Canada's Cornerstone Capital Resources Inc to complete by March 5.
SolGold, a Brisbane, Australia-based developer of copper-gold deposits in Ecuador, said with the acquisition, it plans to reduce its workforce and the number of time zones of its operations to focus to advance the Cascabel project in northern Ecuador. Cornerstone Capital is a prospect generator with a portfolio of gold, silver and copper projects in Ecuador and Chile.
SolGold explained that the closing remains subject to the publication of a prospectus by SolGold. It said that, due to Canadian regulatory requirements, it was required to publish its interim financial results for the half-year ended December 31 by Tuesday. Given this, SolGold said these results are required to be incorporated into the UK prospectus, and therefore the company will resubmit the prospectus.
Under the planned merger, each Cornerstone share will be exchanged for 15 SolGold shares. If SolGold does not pay any part of the deal in cash, its shareholders will hold 80% of the new enlarged firm.
SolGold interim Chief Executive Officer Scott Caldwell said: "The delays are inexcusable. I am leading, with the support of the board, a swift reset in the organization with an emphasis on creating performance-oriented culture with accountability to all stakeholders as a core principle. As a fellow shareholder, I believe it is imperative to take bold action now, ahead of the close of the Cornerstone transaction. I am working closely with our team to ensure that the impact of any organizational change accelerates our strategic objectives.
"In my assessment, the weakness in the organization has for too long been a culture of non-performance in the corporate office. However, having recently spent considerable time at Cascabel and our sites in Ecuador, I am pleased to report that we have a world-class team on the ground that effectively complements our world-class Cascabel project and other prospective assets."
SolGold shares were 2.9% lower at 13.42 pence each in London on Friday morning.
By Tom Budszus, Alliance News reporter
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