Hochschild Mining is planning to demerge the majority of its stake in its indirect wholly owned subsidiary Aclara Resources to focus on its precious metals business.
Representing 80% of Aclara Resources’ entire issued share capital, the demerged shares will be listed on the Toronto Stock Exchange.
The demerger is planned to be completed by the end of this year.
A development-stage rare earth mineral resources company, Aclara holds 451,585ha of mineral concession in the Chilean regions of Ñuble, Biobío, Maule, and Araucanía.
Upon completion of the demerger, Hochschild’s wholly owned subsidiary Hochschild Mining Holdings will have a 20% interest in Aclara Resources.
In relation to the demerger, Aclara plans to hold an initial public offering to raise funds to help advance its exploration and development activities.
The funds will also be used for working capital and general corporate purposes.
Moreover, Hochschild chief financial officer Ramon Barua will step down from his position to take over the role of Aclara director and CEO.
Hochschild chairman Eduardo Hochschild said: “It is our belief that, as two standalone businesses, both Hochschild and Aclara will have the greatest potential for delivering long-term value creation.
“Each will have their own strategic focus on their respective products, their own dedicated management teams, separated access to capital and an independent valuation whilst maintaining a strategic relationship that will allow Aclara to benefit from Hochschild’s track record on project execution and ESG.”
Aclara is working to develop its resources through the Penco Module project, which will produce a rare earth concentrate through a processing plant.
The Chilean firm is also planning to undertake exploration activities to determine possible deposits within its other mining concessions.
Hochschild recently exercised its option to acquire a 60% operatorship stake in the Snip gold project in Canada from Skeena Resources.