Straits Resources has announced a plan to separate its gold and copper assets into two ASX-listed entities, while also downgrading its production forecasts.
The company said its board of directors gave its nod to the plan today, following a strategic review of operations.
The board sees the demerger as an effective way of unlocking value from Straits’ copper and gold producing assets.
Shares in the newly created gold miner would be returned to security holders under the demerger.
“This decision is a significant step forward in our plan to unlock the potential value opportunity within both the gold and copper businesses,” managing director Andre Labuschagne said.
“There is still further work to be done to stabilise the performance of both mines however I am excited by the exploration potential around these mines and the opportunities this may provide to extend mine lives or increase production.”
The company’s share’s gained 1.3 per cent on the ASX today, closing trade at 7.8 cents.
Meanwhile, Straits provided shareholders with an operations update today, reporting that it would not be able to meet its stated objective of producing 100,000 ounces of gold equivalent after mining was recently suspended at the Mt Muro mine.
Straits also revised down its guidance for production from its Tritton copper mine, to between 23,500 tonne and 24,500 tonnes, down from previous production predictions that were 1,000 tonnes higher.
