CHN holders have exposure to Julimar which is great - however many shareholders would have been attached to the gold assets and would not have been happy to lose that exposure. This way CHN are able to divest their non core holdings which would have distracted from the main game, and the new company will be 100% focused - a bit of a win win in my opinion. If you look at Alkane (gold) who spun out ASM ( rare-earths) you can see how such a strategy is able to work on a best case scenario. ASM had a lot more pre work done so I don’t think this is an apples to apples example (rare earths are a different ballgame to gold) however the example is more similar if the gold price takes off and the 30 mil produces great exploration result’s. Good management- well resourced and exploration ground located in elephant territory is the correct recipe for success even though it doesn’t guarantee success.
FAL Price at posting:
41.5¢ Sentiment: Buy Disclosure: Held
