Hecla Acquires Interest In Dolly Varden Silver Corporation

 

COEUR D'ALENE, ID - Hecla Mining Company HL reported that a wholly owned subsidiary of Hecla has entered into a subscription agreement to acquire 20,000,000 common shares of Dolly Varden Silver Corporation. Subject to receipt of approval by the TSX Venture Exchange, the common shares will be issued to the wholly owned subsidiary of Hecla from treasury at a price of $0.16 per common share for total gross proceeds to Dolly Varden of $3,200,000. Upon completion of the transactions contemplated by the subscription agreement, the 20,000,000 common shares will represent and Hecla will exercise control over 19.9% of the outstanding common shares of Dolly Varden. In addition, Hecla has the right to appoint one representative to the Board of Directors of Dolly Varden Silver Corporation and will be providing technical assistance to the company.

Dolly Varden is a mineral exploration company engaged in the exploration and development of silver projects in northwestern British Columbia including the past-producing Dolly Varden and Torbit mines that combined have produced over 20 million ounces of silver. In addition there have been recently defined occurrences in prospective mineral horizons and structures. Dolly Varden's land package is in a geologic setting with world-class projects such as the past-producing Eskay Creek Mine, which is a similar deposit type to Hecla's Greens Creek Mine.

"Hecla is pleased to be able to make a strategic investment in Dolly Varden to participate in the re-emergence of a historic silver district with outstanding exploration and development potential," said Hecla's President and Chief Executive Officer Phillips S. Baker, Jr. "This is one of many strategic investments in junior mining companies with strong management and outstanding exploration land packages that Hecla is contemplating as we seek to expand our exposure to under-explored silver-gold mining districts in the Americas."

The common shares will be acquired for investment purposes by Hecla. Hecla does not have any present intention to acquire ownership of, or control over, additional securities of Dolly Varden. It is the intention of Hecla to evaluate its investment in Dolly Varden on a continuing basis and such holdings may be increased or decreased in the future.

The company's address is 6500 N Mineral Dr, Suite 200, Coeur d'Alene, ID 83815-9408, 208.769.4100, fax: 208.769.7612.