Prospect Generator

What is a prospect generator? (Image: Tarsis)

Tarsis Resources (TCC:TSXV) and Estrella Gold Corp (EST:TSXV) two sub $3 million dollar companies have merged to form a new prospect generator called Alianza Resources. The new company will have a combined 22 projects in four excellent mining jurisdictions (Mexico,Peru,Nevada, and the Yukon).

The deal is a smart move for shareholders as it will consolidate management expertise and reduce general and administrative costs.

The plan is to merge the companies on a 1:1 basis with Tarsis acquiring all the shares of Estrella. A 10:1 rollback will then be completed and the new company (Alianza) will have 10.8 million shares outstanding.  Then comes the tough part of trying to close a $2 million dollar financing at 35 cents.

If successful raising the $2 million the company has stated $1.5 million will be used on project work and $500,000 for working capital.

The deal is expected to close in April.

Mark T. Brown, BComm, CPA-CA, proposed executive chairman of Alianza, noted: "This transaction has been designed to give the shareholders of Tarsis and Estrella a better chance at participating in the success of the combined company's exploration success. At the same time, we recognize that a share consolidation and refinancing can be dilutive for existing shareholders. Tarsis is allowing all of its existing shareholders to participate in the proposed financing by making use of one of the latest rules issued by the securities commissions in certain Canadian provinces that allows for non-accredited shareholders to participate in the financing. Our investment group is a large shareholder of both companies and we will continue to support this very strong technical team."

You can follow Mark on twitter with the handle @mtbrown2

Tommy's been doing some digging on a relatively unknown prospect generator Evrim Resources more at chat.ceo.ca/evm

Read: Tarsis Resources Ltd. and Estrella Gold Corporation to Form Alianza Minerals Ltd.

Related: AME BC Roundup Video with Marc Blythe, CEO, Tarsis Resources or AME BC Roundup Video with Jason Weber, CEO, Estrella Gold

This is not investment advice. All facts are to be checked and verified by reader. As always please do your own due diligence.