Guardian Metal Resources (AIM:GMET) has approved in principle a plan to spin out its non-tungsten exploration assets into a new company, targeting admission to AIM by the second quarter of 2027.
The London and NYSE American-listed exploration company, which is developing tungsten projects at Pilot Mountain and Tempiute in Nevada, said the move is designed to sharpen its focus on becoming a US tungsten developer.
The assets earmarked for the new entity, referred to as Spin-Co, are Garfield, Golconda Summit and Stonewall, all in Nevada, covering gold, silver and copper exploration interests.
No binding agreements have been signed and the transaction remains subject to final structure, regulatory and third-party approvals, final board sign-off and market conditions.
Under the structure currently envisaged, Guardian Metal would transfer the non-core projects to Spin-Co in exchange for newly issued Spin-Co shares, retaining what it expects to be a significant shareholding.
The company said this would let shareholders keep indirect exposure to the gold, silver and copper assets while freeing up cash and management attention for the tungsten business.
"We continue to see excellent potential in our gold, silver and copper exploration assets, and we believe they would be better served as a standalone company with its own strategy, leadership and capital," said chief executive Oliver Friesen.
Guardian Metal said claim maintenance and exploration costs for the non-core projects would, if the deal completes, be funded by Spin-Co rather than competing for capital with its tungsten development budget; the precise asset perimeter, valuation, funding and governance structure have not yet been finalised, and the company's eventual ownership stake in Spin-Co will depend on the size of any Spin-Co fundraising.
Guardian Metal is not announcing a distribution of Spin-Co shares to its own shareholders, and said the proposed transaction, including any dilution of its stake from a future Spin-Co raise, will be assessed against AIM Rules class tests, with related-party and shareholder approval requirements complied with where applicable.
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The announcement follows the company's pre-feasibility study on Pilot Mountain, completed on 30 June, which modelled an after-tax net present value of $660.3m and estimated initial capital expenditure of $288.7m, with first ore targeted for the fourth quarter of 2028.
Separately, Guardian Metal confirmed remuneration arrangements for Friesen first disclosed on 17 July, after it emerged that options originally granted to him in May 2023 had failed to qualify for UK enterprise management incentive tax treatment.
The company has granted Friesen a new EMI option over 181,817 shares at 10.75p, extended the exercise period on his original options by five years to 3 May 2031, and agreed to indemnify him for the net tax cost of the shortfall, capped at the amount that would have arisen had the original options been exercised on their original expiry date.
Further announcements on the spin-out are expected once the structure and key commercial terms have been determined.