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by Stockwatch Business Reporter

The TSX Venture Exchange declined 14.25 points to 707.38 Thursday. Ryan Fletcher's halted capital pool shell, Montan Capital Corp. (MO), plans to merge with Jim Borland's cash-strapped Peruvian precious and base metals explorer, Strait Minerals Inc. (SRD: $0.005). The conditions of the qualifying transaction require that shareholders of Strait approve a 1:10 rollback, which will leave it with 6,203,258 postconsolidated shares. Montan, with eight million shares outstanding, and Strait will then merge and issue shares to their shareholders on a 1:1 basis. The shell comes with a rather large treasury. As of July 31, 2014, it had a working capital of more than $800,000.

Montan talks up Strait's Alicia copper property in Peru, pointing out that the Peruvian subsidiary of Teck Resources Ltd. (TCK: $16.75) financed a 10-hole, 4,000-metre drill program in 2013 at a cost of about $2.9-million. Teck had previously signed an agreement to option up to 75 per cent of Alicia by spending $30-million on exploration. Montan fails to mention that Teck dropped the option the following February after the assays arrived. Teck remains a large shareholder of Strait and will control 900,000 shares after the merger. It will be the second-largest shareholder of the merged company, behind David Hodge's Zimtu Capital Corp. (ZC: $0.375), which owns 1.06 million shares of Montan.

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