something's COOKING
Sierra to expand into e-commerce sector
Sierra Nevada Gold Ltd SDD
Shares issued 17,086,456 Apr 17 close $0.05
Tue 18 Apr 2000 News Release
Mr. Mark Lee reports
Sierra Nevada Gold has been involved in mineral exploration since 1980 and
its shares have traded on the Vancouver Stock Exchange since 1981 (now the
Canadian Venture Exchange).
In 1995, Sierra acquired a lease/option-to-purchase the Promontorio
property, a high-grade copper, gold and silver project located in
Chihuahua, Mexico. The company completed over 24,000 feet of core drilling
in 57 holes and obtained a preliminary resource calculation from Mine
Development Associates (MDA), a mining engineering firm located in Reno,
Nev., in 1997. MDA detailed a resource with a cutoff grade of .5 per cent
copper, containing over 89 million pounds of copper, two million ounces of
silver and 80,000 ounces of gold. Unfortunately, soon after their report
was completed, metal prices began falling sharply, as did the Vancouver
Mining Index. Despite the company's best efforts, it has been unable to
obtain the needed financing to further develop this outstanding property.
The company continues to hold the property under lease and is presently
renegotiating the lease which will forgive past unpaid payments.
Due to continued low metal prices and the general malaise of the mining
industry, Sierra is seriously considering diversifying its business and
expanding into the e-commerce sector. An outstanding opportunity has been
presented to Sierra, dependent upon Sierra raising the moneys necessary to
complete a due diligence report and valuation of the target company.
The owners of the private, e-commerce company have developed its
business-to-customer (B2C) site over the past two years and since its
introduction in December of 1999, it has had remarkable success even
without mass marketing or advertising. The site is involved in a niche
market which is projected to be a $50-billion industry in 2000. To date, no
other site has captured this growing market. The company's business plan
calls for aggressive marketing and expansion, in addition to their plans to
expand with a business-to-business (B2B) portal.
The management team includes two chartered accountants, both employed with
large Canadian corporations, an attorney with experience in running a
multimillion dollar enterprise, a technical person and an individual who is
a senior project manager with a large company for e-selling globally. The
company believes that with the business ideas in place and the strong
management team, this company is sure to be a winner in the rapidly
expanding Internet commerce sector.
Sierra Nevada has an opportunity to purchase a 95-per-cent interest in this
company and by combining the new corporation with Sierra, management
believes Sierra's shareholders stand to profit significantly. All
negotiations at this time are tentative and the decision to take Sierra in
this direction depends upon raising immediate working capital to facilitate
a due diligence study and its ability to obtain a brokerage firm to sponsor
the new company. Sierra will be seeking financing through a private
placement of its shares. Details will be announced when this is arranged.
If Sierra should reach an agreement and obtain the necessary approval,
there is no planned reverse share split. There would be a name change, but
shares in Sierra will be traded on a one-to-one basis. There are currently
no assurances that Sierra will proceed in this direction. This is a long
process of approval from exchange and regulatory authorities as well as the
due diligence report to ascertain the value involved in the potential
purchase. The company would maintain its Mexican subsidiary and continue
seeking joint venture financing to further develop the very valuable
Promontorio property. The company will make timely news releases when any
agreement is reached.
(c) Copyright 2000 Canjex Publishing Ltd. canada-stockwatch.com |
