Usha Resources Ltd. (“Usha” or the “Company”) (TSXV:USHA)(OTCQB:USHAF) is pleased to announce that its Board of Directors is currently evaluating a proposal for Usha to transfer the Company’s Nicobat Nickel property (the “Property“) located in Dobie Township, Northwest Ontario to a newly formed subsidiary (“SpinCo“) and subsequently spin out the shares of SpinCo (“SpinCo Shares“) to Usha’s shareholders at a ratio yet to be determined (the “Transaction“). The Company will retain an interest in SpinCo.
Deepak Varshney, CEO stated: “With nickel prices soaring, we see this as the perfect backdrop to unlock value for investors by spinning out what was once our flagship property into a separate, battery-metals oriented public company. We don’t believe the market is fully valuing the sum of our parts and we see this as the ideal solution to ensure our projects get the attention and command the valuation they deserve. Spinning out the Nicobat property will allow Usha to streamline its focus while also allowing shareholders to participate in and benefit from the creation of a new battery-metals focused exploration company. With shareholders of Usha receiving shares in the SpinCo, we feel that the contemplated transaction would create a compelling new dynamic to our investment thesis as investors would stand to own shares in two public companies that are on two clear paths.”
The completion of the proposed Transaction and contemplated distribution of SpinCo Shares to Usha shareholders are subject to a number of conditions, including the completion of corporate, legal and tax structuring, completion of SpinCo financing, determination of final details of the transaction, the appointment of a Board and management team for SpinCo, required regulatory and shareholder approvals, and the subsequent listing of the SpinCo Shares on the TSX Venture Exchange.
There is no certainty that the Transaction will be completed on the terms proposed or at all. The Board of Usha may determine to not proceed with the Transaction should there be a change in market conditions or investor interest or should another opportunity arise that would similarly enhance value to Usha shareholders.
The Company will provide updates when further details of the proposed Transaction are determined.
About the Nicobat Nickel Property
The Nicobat Nickel Property is a nickel-copper-PGE project located in Dobie Township, Northwest Ontario 21 kilometres south of New Gold’s Rainy River Mine which hosts the Zone 34 nickel discovery.
Historic exploration work between 1952 and 1972 included over 15,000 metres of drilling, 220 drill holes and numerous bulk samples that identified a non-compliant historic resource of 5.3 Mt grading 0.24% Ni that contained a high-grade zone of approximately 225,000 tons grading 0.87% Ni.
Recent exploration work includes over 4,000 metres of drilling that has confirmed high-grade nickel-copper shoots do exist and are considerably better than previously recorded in the historical drilling, with drillhole A-04-15 intersecting from surface to approximately 63.75 metres a weighted average of 1.05% nickel and 2.18% copper that included an approximately 9.8-metre interval of 1.92% Ni from 53.95 to 63.75 metres.
The targeted feeder conduit measures approximately 305 metres by an average of 60 metres in width to a depth of 245 metres that is potentially open at depth and down-plunge to the north and is composed of cumulate textured olivine gabbro. This magma conduit sits in a larger norite body at the base of the Dobie Gabbro. The historical assessment data records high-grade “ribs”, one of which includes the zone described above. Future work will, therefore, focus on making the historic resource compliant current and expanding on the work completed to assess for other high-grade “ribs” and the potential high-grade feeder zone as shown in the model below.
Qualified person
The technical content of this news release has been reviewed and approved by Mr. Andrew Tims, P.Geo., a qualified person as defined by National Instrument 43-101.
About Usha Resources Ltd.
Usha Resources Ltd. is a Canadian mineral acquisition and exploration company based in Vancouver, BC, Canada. Usha is exploring for commercially exploitable mineral deposits and is currently focused on deposits located in Northwest Ontario, Canada and the Lost Basin Gold Mining District in Mohave County, Arizona, U.S.A. Usha increases shareholder value through the acquisition and exploration of quality precious and base metal properties and the application of advanced state-of-the-art exploration methods. Usha’s portfolio of strategic properties provides diversification and mitigates investment risk.
We seek Safe Harbor.
USHA RESOURCES LTD.
“Deepak Varshney” CEO and Director
For more information, please call 778-899-1780, email info@usharesources.com, or visit www.usharesources.com.