Atlantic Gold and Spur Ventures merger agreed

THE BOURSE WHISPERER: Atlantic Gold (ASX: ATV) has entered into a Heads of Agreement with Toronto-listed company Spur Ventures Inc. (TSX-V: SVU), which sets out the basis of a merger between the two companies.

The merger will result in Spur acquiring all of the ordinary shares on issue in Atlantic by way of a scheme of arrangement.

Spur is a natural resource company headquartered in Vancouver, Canada and an obvious fit for Atlantic’s Canadian ambitions.

Spur’s only material asset at this time is approximately C$28.7 million in cash, which means it is well-funded and in search of a project.

Atlantic was recently on the good side of a decision by the Supreme Court of Canada to dismiss a former landholder’s application to appeal previous decisions in regard to ownership of the last private property at the company’s Touquoy gold project.

In effect the company has now raised C$28.7 million to fund development of Touquoy.

“We are delighted to have finalised the Heads of Agreement for the merger with Spur,” Atlantic Gold chairman Ronald Hawkes said in the company’s announcement to the Australian Securities Exchange.

“The merger presents Atlantic shareholders with a most important first step towards the funding of the development of the Touquoy gold project, without the material dilution in the value of their shares that would have resulted had we taken a capital raising of this size to the market.

“It also repositions Atlantic’s Nova Scotia gold assets, both the Touquoy and Cochrane Hill development properties and Atlantic’s consider able holding of highly prospective exploration properties, in a Canadian company, with a TSX-V listing, and under the control of the Spur board and experienced in-country management who are highly motivated to add value to the asset portfolio including, importantly, finalising the preparations for, and pursuing the funding of, the Touquoy Gold project.”

“It is also pleasing that Spur has indicated that the Atlantic managing director, Mr Wally Bucknell, will be invited to join the Spur board as a non-executive director upon the completion of the transaction.”