Riverside Resources (RRI.V) has provided an update on its plans to spin out Capitan Mining (CAPT.V) and the date has now been set at August 14th. Holders of Riverside shares as of the end of business on Monday, August 13th will receive 0.2767 shares of Capitan per share of Riverside they ow: an investor owning 10,000 shares of Riverside will receive 2,767 shares of Capitan Mining which just completed a C$3.5M warrant-free raise at C$0.20. Keep in mind ‘owning’ Riverside stock on August 13th very likely means that anyone who buys on August 13th will NOT be entitled to the SpinCo shares as we would assume the record date of someone buying on August 13th will be August 15th and thus post-spinoff date. The Great Bear Royalties spinoff had similar issues where some investors missed out on the spinco shares as the difference between the transaction date and record date was unclear. In case of doubt if you are entitled to receive Capitan shares, check with your broker.
From August 14th on, Capitan Mining will be operating as a separate entity with full ownership of the Penoles gold-silver project in Mexico. Once the dust has settled, we will be in touch with Alberto Orozco, the CEO of Capitan, to discuss his next plans. Trading in Capitan should start before the end of the month.
Disclosure: The author has a long position in Riverside and will receive Capitan shares. The author did not participate in the Capitan raise but will put in some stinkbids on the open market.