In a strategic move to unlock value for its shareholders, G2 Goldfields Inc. (TSX: GTWO, OTCQX: GUYGF) has announced plans to spin out its non-core assets into a new subsidiary, G3 Goldfields Inc. The Toronto-based gold exploration company, known for its operations in Guyana, will put this proposal to a shareholder vote at its upcoming annual and special meeting scheduled for January 28, 2025.
The proposed spin-out would see G2’s non-core assets, including several properties in Guyana’s Puruni and Cuyuni districts, transferred to G3 Goldfields. These assets encompass the Tiger Creek, Peters Mine, Aremu Mine, and Amsterdam Option properties, as well as the Aremu Partnership, which includes the historic Wariri Mine.
Dan Noone, CEO of G2 Goldfields, believes that the current share price doesn’t fully reflect the value of these non-core assets. “By completing this spin-out, we aim to unlock hidden value for our shareholders while allowing G2 to focus on our flagship OKO project in Guyana,” Noone explained.
Under the proposed arrangement, G2 shareholders would receive one G3 share for every two G2 shares held as of the effective date of the arrangement. Only shareholders of record at the close of business on the effective date will be eligible for this distribution. The spin-out is subject to several conditions, including shareholder approval at the upcoming meeting, regulatory and court approvals, and G2 entering into a formal arrangement agreement. G2 also intends to list G3 shares on a recognized Canadian stock exchange, subject to meeting listing requirements.
This move comes on the heels of G2’s updated Mineral Resource Estimate for its Oko property in Guyana, announced in April 2024. The estimate revealed significant gold resources, with the Oko Main Zone showing 686,000 oz. Au indicated at 9.03 g/t and 495,000 oz. Au inferred at 6.38 g/t, while the Ghanie Zone reported 236,000 oz. Au indicated at 2.20 g/t and 604,000 oz. Au inferred at 1.54 g/t.
G2 Goldfields has been attracting attention in the mining sector, with Anglo Gold Ashanti currently holding 35,948,965 shares representing a 15.03% stake in the company. With cash holdings exceeding US$31.8 million (C$43 million), G2 is well-positioned to pursue its exploration programs.
Shareholders of record as of December 17, 2024, will be eligible to vote on the proposed spin-out at the January meeting. More details about the arrangement will be provided in the management information circular, expected to be mailed to shareholders in early January 2025.
As the gold exploration landscape continues to evolve, G2’s strategic move could set a precedent for other companies looking to maximize shareholder value through asset reorganization.
