LONDON: Guardian Metal Resources has approved in principle a plan to spin out its non-tungsten exploration portfolio into a new company, with a listing on AIM targeted by the second quarter of 2027, the company said in a statement.

The tungsten-focused miner said the new entity, referred to as Spin-Co, is expected to hold Garfield, Golconda Summit and Stonewall, all located in Nevada. Garfield covers gold, silver and copper, Golconda Summit gold, and Stonewall silver and gold.

No binding agreements have been signed so far. The deal remains subject to final structure, regulatory and third-party approvals, final board approval and market conditions.

Guardian Metal will keep Pilot Mountain and Tempiute, along with its other tungsten projects including Pilot North, Cinch and White Elephant, which are expected to support its hub-and-spoke strategy.

“We continue to see excellent potential in our gold, silver and copper exploration assets, and we believe they would be better served as a standalone company with its own strategy, leadership and capital,” said Oliver Friesen, CEO of Guardian Metal.

Friesen said the pre-feasibility study for Pilot Mountain has been completed and the definitive feasibility study is well underway, while mine permitting is progressing in parallel. The company is also talking to potential financing partners and government agencies as it works to establish domestic tungsten production in the US.

Under the proposed structure, Guardian Metal would receive newly issued Spin-Co shares in exchange for the transfer of the assets and expects to remain a significant shareholder. Its final stake will depend on the size of any Spin-Co fundraising.

The board said the move would help the company keep cash for its core projects, as claim maintenance and exploration costs would be borne by Spin-Co. It added that separating the businesses could make each easier for investors to evaluate, though there was no assurance of any valuation uplift.

Guardian Metal clarified that it is not announcing a distribution of Spin-Co shares to its shareholders. The company will also assess the transaction against AIM rules and comply with any notification and shareholder approval requirements.

Separately, the company updated on options granted to Friesen. An option over 2,104,859 shares, issued in 2023 at 10.75p each, was later found not to qualify for tax-advantaged EMI treatment under UK rules.

To restore his intended position, the company granted a new EMI option over 181,817 shares, the maximum allowed under the £250,000 individual limit, at the same exercise price. It also extended the original option’s exercise period by five years to May 3, 2031, and agreed to cover the net tax cost, subject to a cap.

The independent directors said the arrangements include good leaver and bad leaver provisions and are fair and reasonable for shareholders.