NGEx Minerals to Spin-Out Valle Ancho Project to Shareholders Creating New South America Focused Lundin Group Exploration Vehicle
NGEx Minerals Ltd. has announced its intention to spin out its Valle Ancho Project into a newly incorporated, wholly-owned subsidiary, referred to as "Spinco," through a statutory plan of arrangement. The transaction creates a new South America-focused exploration vehicle under the Lundin Group, allowing NGEx to retain its more advanced Lunahuasi and Los Helados projects while Spinco focuses on the district-scale Valle Ancho asset and future acquisitions.
Under the proposed structure, shareholders will receive one-fifth of a Spinco Share for each NGEx Share held, with no change in their holdings in NGEx. The transaction requires shareholder approval by at least 66 2/3% of votes cast, as well as approval from the TSX and the court. A special meeting to vote on the matter is scheduled for the fourth quarter of 2026.
Spinco will hold a 100% interest in the Valle Ancho Project, which comprises a district-scale 109,000-hectare land package covering the eastern side of the Maricunga Gold Belt in Chile and extensions into Argentina. The property includes several separate copper-gold porphyry targets in Argentina, and 2022 drill programs demonstrated significant porphyry copper and gold mineralization. Meanwhile, NGEx will retain its 100% owned Lunahuasi Project and an approximate 69.1% interest in the Los Helados Project.
Financially, NGEx expects to make a cash injection into Spinco. These funds are intended to be used for the acquisition of the Valle Ancho Project from NGEx and to provide Spinco with working capital for at least 12 months post-completion. Additionally, each outstanding NGEx stock option will be exchanged for a replacement NGEx option and a fully-vested Spinco option. The Spinco option will be exercisable for one-fifth of a Spinco Share, with exercise prices adjusted to reflect relative share value.
Wojtek Wodzicki will serve as CEO and Chairman of Spinco, with Alex Tong as CFO and Heidi Chik as Corporate Secretary. The Spinco Board will include Bob Carmichael, Joyce Ngo, and Nathan Monash. Spinco intends to apply to list on the TSXV, though the application has not yet been submitted. NGEx continues to trade on the TSX under the ticker NGEX and on the OTCQX under NGXXF.
Wojtek Wodzicki, President and CEO of NGEx Minerals, commented on the strategic move. "NGEx has a long track record of creating value through successful exploration and strategic spin-outs. This latest spin-out will establish a new Lundin Group exploration vehicle that intends to embody the ethos that has driven NGEx's success over the years, while allowing NGEx to focus on its more advanced Lunahuasi and Los Helados Projects," Wodzicki said.
He added, "With Valle Ancho, a district-scale copper-gold exploration opportunity that resembles the Vicuña District in its earliest days as its foundational asset, and lead by a number of the team pivotal in discovering the Vicuña District, this next iteration of NGEx's spin-out strategy will aim to not only advance its current assets but also to grow by opportunistically building a portfolio of highly prospective exploration projects."