Esperanza to Sell San Luis, Peru Interest to Silver Standard
March 01 2011 - 6:00AM
Marketwired
Esperanza Resources Corp. (TSX VENTURE: EPZ)(PINK SHEETS: ESPZF) is
pleased to announce that it has reached an agreement to sell its
minority interest in the San Luis project, Peru, to Silver Standard
Resources Inc. (TSX: SS0)(NASDAQ: SSRI), the majority owner and
operator of San Luis. The transaction has been approved by the
Boards of Directors of Esperanza and Silver Standard but remains
subject to customary conditions, including the receipt of
regulatory and other required approvals.
Under the terms of the agreement, Esperanza will receive as
consideration:
-- A payment of CDN$17 million;
-- Return of the 6,459,600 shares of Esperanza owned by Silver Standard;
and
-- A one percent net smelter return royalty on all production.
Bill Pincus, Esperanza's President and CEO, said, "This is a
good transaction all the way around. Esperanza is monetizing its
minority interest in a non-core asset. The cancellation of the
Esperanza stock could remove up to approximately 11 percent of the
outstanding shares and result in a greater asset value per
remaining share. The cash payment together with the existing funds
will result in a $27 million treasury for EPZ.
"The proceeds will allow Esperanza to focus on the advancement
of the Cerro Jumil, Mexico project, continue EPZ's involvement with
Global Mineral Ltd. and its Strieborna, Slovakia deposit and move
forward with its new exploration prospects in Peru and Mexico. With
interests in two advance-stage projects, a full treasury and an
exciting exploration portfolio, Esperanza is well positioned for
future growth and creating new opportunities to further enhance
shareholder value.
"It has been a pleasure concluding this agreement with Silver
Standard and we wish them the best success in developing San
Luis."
About Esperanza
Esperanza is focused on advancing the development of its
principal property, the wholly-owned Cerro Jumil gold project in
Morelos State, Mexico. It is also actively investigating 11 other
exploration interests in Peru and Mexico. In October of 2010 it
announced a strategic investment which resulted in a 35% interest
in Global Minerals Ltd. (TSX VENTURE: CTG), majority owner of the
Strieborna silver/copper/antimony project in Roznava, Slovakia.
SAFE HARBOUR: Some statements in this release are
forward-looking in nature. The United States Private Securities
Litigation Reform Act of 1995 provides a "safe harbour" for certain
forward-looking statements. Such statements include statements as
to the potential of the Cerro Jumil property, the ability to
finance further exploration, permit drilling and other exploration
work, and the availability of drill rigs.
The forward-looking statements involve risks and uncertainties
and other factors that could cause actual results to differ
materially, including those relating to exploration and bringing
properties into production. Please refer to a discussion of some of
these and other risk factors in Esperanza's Form 20-F filed with
the U.S. Securities and Exchange Commission. The forward-looking
statements contained in this document constitute managements'
current estimates as of the date of this release with respect to
the matters covered herein. Esperanza expects that these
forward-looking statements will change as new information is
received and that actual results will vary, possibly in material
ways. Forward-looking statements are based on the beliefs,
expectations and opinions of management on the date the statements
are made, and the company does not assume any obligation to update
forward-looking statements if circumstances or management's
beliefs, expectations or opinions should change. For these reasons,
investors should not place undue reliance on forward-looking
statements.
Neither the TSX Venture Exchange nor the Investment Industry
Regulatory Organization of Canada accepts responsibility for the
adequacy or accuracy of this release.
Contacts: Esperanza Resources Corp. Bill Pincus President and
CEO 1 866 890 5509 info@epzresources.com www.epzresources.com
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