Tocvan Ventures Corp has announced that it will buy 100% of the Rogers Creek copper project in British Columbia (BC) from C3 Metals Inc. (TSX-V:CCCM) and unveiled plans to spin out the asset to a newly created company - Cascade Copper Corp - so it can concentrate on its two Mexican properties.
Previously, Tocvan had an option to buy up to an 80% in Rogers Creek from C3 Metals but that deal is now void, replaced by the agreement to buy all of the project.
Tocvan told investors that, subject to shareholder and regulatory approval, it aims to spin out Rogers Creek to Cascade Copper, which will focus on copper porphyry exploration in southern British Columbia.
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For the Rogers Creek property, Tocvan will issue C3 Metals with 500,000 of its shares. C3 Metals will also receive shares of Cascade Copper equal to C$75,000, based on pre-listing finance price, upon the latter listing on the Canadian Securities Exchange.
C3 Metals will retain a 2% net smelter royalty (NSR) on the Rogers Creek property, 1% of which can be repurchased by Cascade for C$1 million.
“We believe the value of the Rogers Creek property is not reflected in Tocvan's current share price and see the proposed Spin-Out to create additional value for Tocvan shareholders," said Derek Wood, Tocvan CEO in a statement.
"By creating a new company, Tocvan shareholders can participate in the upside possibility through share ownership of Cascade Copper, while Tocvan is able to focus on its two Mexican properties and minimize share dilution. We believe the proposed Spin-Out will be very beneficial to Tocvan shareholders," he added.
Tocvan noted that the spin-out of Cascade will be structured as a plan of arrangement, where Tocvan shareholders will receive one Cascade Copper share for every six Tocvan shares held. When and if approved, Tocvan will then have no interest in the Rogers Creek asset.
Cascade Copper is set to hold two advanced, drill-ready copper porphyry properties in the Cascade Magmatic Arc in BC - the contiguous Rogers Creek property and the Fire Mountain property.
Combined, the properties have seen over C$3 million of exploration to date and cover an area of around 240 square kilometers (sq km).
Previous work at Rogers Creek has included 5,209 metres (m) of diamond drilling in ten holes, including the analysis of 1,951m of drill core.
There has also been prospecting, mapping, and sampling, including the collection of 1,061 surface rock samples, 3,328 soil samples, and 318 stream sediment samples.
Contact the author at giles@proactiveinvestors.com