Demerger to create new ASX listed gold focussed Western Gold Resources, creating substantial value for GWR shareholders

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GWR to demerge and IPO Wiluna West Gold Project. (Credit: aymane jdidi from Pixabay)

GWR Group Limited (ASX:GWR) (“GWR Group” or “ the Company”) is pleased to announce that following a review of its Wiluna West Gold Project it is the Company’s intention to seek shareholder approval for the demerger and IPO of its wholly owned subsidiary, Western Gold Resources Limited, which holds the Wiluna West Gold Project.

GWR Chairman Mr Gary Lyons commented “With GWR’s Wiluna West Iron Ore now delivering revenue, we believe the time is right to take advantage of the buoyant Gold price and spin-out our highly prospective gold assets whilst rewarding our loyal shareholders with an in-specie distribution.

We believe the Wiluna West Gold assets will attract better investor attention and valuation in a standalone entity, while GWR can focus on the development of its remaining assets.

Given the quality of the Wiluna West Gold Project and the minimal work undertaken in recent years, we expect that Western Gold Resources Limited will attract the level of capital required to aggressively and systematically explore the (relatively under-explored) 22km of Joyners Find Greenstone Belt whilst also advancing the brownfields resource.

We look forward to realising the true potential of our gold portfolio and will continue to update the market with the progress of the proposed Western Gold Resources Limited IPO and GWR’s Strategic Investments.”

The Company will shortly convene a General Meeting of shareholders to seek approval for a reduction in the Company’s issued capital by making a pro-rata in-specie distribution of all the shares currently on issue in Western Gold Resources Limited to eligible GWR shareholders. The in-specie distribution will also be subject to Western Gold Resources Limited receiving approval for admission to the official list of ASX.

A successful IPO would allow GWR to continue to focus its efforts on its Wiluna West Iron Ore project which continues to deliver revenue from its C4 Iron Ore deposit.

The Company believes that significant exploration upside exists along GWR’s relatively under-explored 22km of the Joyners Find Greenstone belt which sits adjacent to the prolific Norseman- Wiluna Greenstone belt (Figure 1).

GWR has recently updated the Mineral Resource estimate for the Wiluna West Gold Project (WWGP) upgrading the remaining JORC 2004 Mineral Resource estimates to JORC 2012.(refer to ASX announcement 12th April 2021). The combined Wiluna West Gold Project’s JORC-2012 Mineral Resource estimate is now 4,570,000 tonnes at 2.0 g/t Au for 293,000 oz Au. This represents an increase of 403,000 tonnes on the previous estimate, which was partly reported under the JORC 2004 code (refer to ASX announcement 15th August 2019).

The Company has recently completed a drilling program on the Eagle and Emu prospects comprising 55 RC holes for an aggregate of 2145m for the purpose of following up previous high-grade intercepts to investigate continuity and infill drilling to increase confidence in the current JORC 2012 Resource.

In addition to the development of the C4 Iron Ore Project and the proposed IPO of the Wiluna West Gold Project, GWR holds a number of other strategic investments.

  • GWR holds a 8.9% equity interest in Tungsten Mining Ltd (TGN:ASX) valued at ~$10.50m (as at 16/04/21)
  • GWR holds a 7.4% equity interest in eMetals Ltd (EMT:ASX) valued at ~$1.14m (as at 16/04/21)
  • TGN has a 20% JV and Farm-in Agreement into GWR’s Hatches Creek Tungsten Project

Source: Company Press Release