Guerrero Exploration (CVE:GEX) and partner Riverside Resources (CVE:RRI) Tuesday announced a deal which sees Riverside become the largest single shareholder in Guerrero.
part of the deal, Guerrero will own 100 percent interests in the Cerro
Azul and Chapalota projects with Riverside receiving $2 million in
"This agreement will provide Riverside
shareholders with strong upside given that Riverside will now hold such a
substantial share position in Guerrero," Riverside Resources' president and CEO John-Mark Staude said.
look forward to working towards drill testing and advancing high
quality prospects that will generate value for both Guerrero and
Riverside shareholders at a time when it is vital for companies to
consolidate ownership and focus on the best chances for discovery."
president and CEO David Stadnyk said: "Having Riverside acquire a major
control block and adding three of their key executives to Guerrero's
board of directors and advisory board is a major step forward for the
"Given our successful past working relationship and
Riverside's ability to acquire properties and partnerships, this new
development will propel Guerrero to the next level. We will leverage off
Riverside's past, present, and future success to better solidify
Guerrero's ultimate goal in finding a resource."
said that the transaction will strengthen the partnership between the
two companies, with Riverside having an opportunity to increase its
management presence and support through representation on the board of
directors and advisory board.
In a statement, both companies
said the agreement will facilitate exploration progress and allow
Riverside and Guerrero to take strides towards an initial drill program
at the Cerro Azul copper-gold project and follow-up on remaining drill
targets at Chapalota.
Riverside's on-the-ground team in Mexico will assess and advance other properties for Guerrero's portfolio.
companies already enjoy a strong working relationship and believe that
this transaction will leverage the knowledge and resources required to
identify valuable opportunities moving forward.
Cerro Azul is
located near the highly productive southwestern Mexico, Guerrero Gold
Belt. The 2011 work program on the 261 square km property consisted
primarily of rock chip and soil samples.
Chapalota is located along the western side of the Sierra Madre Occidental Region of Mexico.
91 square km property is 50 km to the south of Silvermex's Rosario
deposit and 70 km to the north of Oro Mining's La Trinidad deposit.
Riverside and Guerrero completed IP and soil surveys defining six target
areas on the Project.
Regarding board changes, David Stadnyk
will continue to serve as president and CEO and, in addition to having
two members of Riverside's senior management (Robert Scott and Howard
Davies) appointed to Guerrero's board of directors, John-Mark Staude
will be appointed to Guerrero's advisory board.
The transaction will require Guerrero shareholder approval as well as TSX approval.