VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - May 31, 2007) - General Minerals Corporation ("GMC")(TSX:GNM) today announced that it is continuing to review strategic alternatives with a view to further enhancing shareholder value.
As part of that strategic review, GMC announced that it has entered into discussions with Sprott Asset Management to explore the possibility of entering into a management services agreement with Sprott Asset Management. GMC is also considering completing a $60 million private placement with a number of investors that would involve the issuance of 40 million units at $1.50 per unit. Each unit would be comprised of one common share and one common share purchase warrant, with each warrant being exercisable for two years at $2.50. It is anticipated that, if the private placement is completed, the management services agreement and a new management team will be put in place and there will be changes to its board of directors. Further details are not yet known at this time.
GMC's Board is also continuing to explore other opportunities to deliver further value to shareholders. In this regard, GMC is considering proceeding with its previously announced (see GMC PR07-06, May 4, 2007) plan to spin off its property interests located in the U.S. and in Mexico into a new gold-copper focused company in a manner similar to its recent successful IPO spin-off of its South American property interests to South American Silver Corp. (TSX:SAC).
GMC currently has approximately 9.4 million shares outstanding and continues to be in a strong financial position with $7 million in cash as at March 31, 2007 and 8.6 million shares of South American Silver Corp.
Each of the alternatives under consideration will be subject to shareholder approval as well as the approval of the Toronto Stock Exchange. No assurance can be provided that this continuing review of alternatives will result in any specific action being taken by GMC and readers are cautioned in this regard.
Certain statements contained herein constitute "forward-looking statements". "Forward looking statements" look into the future and provide an opinion as to the effect of certain events and trends on the business. Forward-looking statements may include words such as "plans," "intends," "anticipates," "should," "estimates," "expects," "believes," "indicates," "targeting," "suggests," "potential" "interpretation" and similar expressions. These forward-looking statements are based on current expectations and entail various risks and uncertainties. Actual results may materially differ from expectations as more information regarding the property is gathered or if known and unknown risks or uncertainties affect our business, or if our estimates or assumptions prove inaccurate. The Company assumes no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or any other reason.
SEC 12g3-2(b): 82-34810
FOR FURTHER INFORMATION PLEASE CONTACT:
General Minerals Corporation
Vice President, Investor Relations
(303) 758-2063 (FAX)