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Canstar, Adventus Zinc, Altius Minerals consolidating Newfoundland zinc projects

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Canstar, Adventus Zinc, Altius Minerals consolidating Newfoundland zinc projects

Canstar Resources Inc., Adventus Zinc Corp. and Altius Minerals Corp. on Feb. 21 announced a three-way agreement to consolidate zinc exploration projects in Newfoundland's Buchans Camp.

Canstar will acquire Adventus' 39,000-hectare land package and Altius' Daniel's Harbour zinc project. As consideration, Canstar will issue 86.7 million shares to Adventus and 12.1 million shares to Altius.

The deal also includes a C$500,000 commitment from Altius as part of a C$750,000 private placement by Canstar, for which Altius will be granted a right of first refusal on any royalty or streaming financing related to Canstar's majority-owned Mary March property.

Upon closing of the deal and the private placement, current Canstar shareholders will own approximately 49% of the company. Adventus and Altius will own 40% and 9%, respectively, with the remainder comprising other investors in the placement.

The Canstar board will initially comprise existing Canstar directors David Palmer, Dennis Peterson and Patrick Reid as well as Sam Leung, Adventus' vice president of corporate development. Dennis Peterson will act as chairman and interim CEO.

Canstar also said it plans to raise at least C$2 million following completion of the transaction, which is anticipated by May, subject to approval from the TSX Venture Exchange.

Exploration at the Buchans Camp in 2018 is expected to include 3,000 meters of phased diamond drilling.