Vancouver, British Columbia, May 17th, 2011. Candente Copper Corp. (TSX:DNT, BVL:DNT, US:CDOUF) ("Candente Copper") is very pleased to announce its Board of Directors have unanimously approved a proposal to undertake a spin-out transaction that would reorganize the business and capital structure of the Company into two separate public companies to allow Candente Copper to focus on the development of its flagship Cañariaco copper project.
Pursuant to the proposed transaction, Candente Copper will incorporate a new subsidiary, ExploreCo ("ExploreCo") to which it will transfer 100% of its indirect interest in all of its Peruvian exploration properties, other than the Cañariaco and Jehuamarca claims, which cover the Cañariaco Norte Deposit as well as the Cañariaco Sur and Quebrada Verde prospects by way of a Plan of Arrangement to be completed under the Business Corporations Act (British Columbia) (the "Proposed Arrangement").
In addition to the transfer of the properties, Candente Copper also intends to subscribe for common shares of ExploreCo as part of the Proposed Arrangement in order to provide ExploreCo with approximately Cdn$6 million in working capital.
Candente Copper intends to initially retain a position (approximately 15%) in ExploreCo and distribute the remaining common shares it receives of ExploreCo to its current shareholders on a pro-rata basis (expected to be 1 share of ExploreCo for every 5 shares of Candente Copper held) by way of a reduction of the capital of Candente Copper pursuant to the Proposed Arrangement.
ExploreCo will seek to list its common shares on either the Toronto Stock Exchange ("TSX") or the TSX Venture ("TSX.V") and the Bolsa de Valores de Lima ("BVL ") stock exchanges.
The Proposed Arrangement remains conditional on the approval of final documentation by the Board of Directors of Candente Copper, the approval of the Proposed Arrangement and the listing of the shares of ExploreCo by the TSX or TSX.V (if applicable), the approval of the shareholders of Candente Copper and the approval of the Supreme Court of British Columbia, amongst other things.
Additional details of the Proposed Arrangement will follow upon completion of definitive documentation and will be described in detail in the information circular to be mailed to shareholders of Candente Copper in connection with the Company's annual general and special meeting at which approval by the Company's shareholders of the Proposed Arrangement will be sought.
About Candente Copper
Candente Copper Corp is a TSX and BVL listed mining company focused on exploration and development of base metal mining projects in Peru and Latin America. Candente Copper's flagship project is the 100% owned Cañariaco copper project located in northern Peru's prolific mining district.
Mr. Sean Waller, P.Eng., President of Candente Copper is a Qualified Persons as defined by National Instrument 43-101, has reviewed and approved the contents of this release, and is responsible for the information contained in this release.
This news release may contain forward-looking statements including but not limited to comments regarding the timing and content of upcoming work programs, geotechnical assumptions, geological interpretations, receipt of property titles or permits, potential mineral recovery processes, the timing and structure of proposed transactions, etc. Forward-looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements. Candente relies upon litigation protection for forward-looking statements.
CAUTIONARY NOTE TO U.S. INVESTORS
We advise U.S. investors of terms that are not recognized by the United States Securities and Exchange Commission ("SEC"), including "mineral resources", "measured resources", "indicated resources" and "inferred resources". The estimation of measured and indicated resources involves greater uncertainty as to their existence and economic feasibility than the estimation of proven and probable reserves. U.S. investors are cautioned not to assume that mineral resources in these categories will be converted to reserves. The estimation of inferred resources involves far greater uncertainty as to their existence and economic viability than the estimation of other categories of resources. U.S. investors are cautioned not to assume that estimates of inferred mineral resources exist, are economically mineable, or will be upgraded into measured or indicated mineral resources. U.S. investors are cautioned not to assume that mineral resources in any of these categories will be converted into reserves.
On behalf of the Board of Candente Copper Corp.
"Sean Waller" P.Eng.
President & Director
For further information please contact:
VP Corporate Development
mobile: +1 (604) 614-2999
local: + 1 (604) 689-1957 ext 2
toll free: 1 (877) 689-1964 ext 2
Manager, Investor Relations
mobile: +1 (604) 306-8477
local: + 1 (604) 689-1957 ext 3
Investor Relations, Peru
Tel.: (511) 715-2001 ext 107
Fax: (511) 717-1233