Defiance sells local subsidiaries

Toronto-based Defiance Mining (TSX: DM) has sold its Mexican subsidiaries, Geomaque de Mexico and Mina San Francisco, to a private local company for US$235,000, payable over the next 18 months. The sale covers long-term liabilities totaling US$1.9mn, including a US$925,000 surface rights purchase obligation, approximately US$760,000 in reclamation provisions and other obligations totaling US$246,000, the company said in a statement. Defiance will write down the carrying value of the San Francisco plant, including equipment and parts inventory, to the tune of US$980,000, giving it a net gain of approximately US$1.2mn, including the sale price, it said. The Mexican subsidiaries held the San Francisco gold mine that ended mining operations in 2001. Defiance has the Vueltas del Rio gold mine in Honduras and the Tasiast project in Mauritania.