Riverside Resources: Value Dislocation from Upcoming Spin-Out?RRI is down over 30% this week, despite no negative news. This may be a classic case of value dislocation ahead of a corporate event.
📦 What’s happening?
Riverside is spinning out its Ontario gold assets into a new company, Blue Jay Gold Corp. Every RRI shareholder will receive 1 Blue Jay share for every 5 RRI shares held. These new shares are expected to be listed soon.
🧠 Why it matters:
Spin-outs often unlock hidden value by allowing each entity to focus on a clear strategy. The market sometimes misprices the parent company temporarily, creating an opportunity for informed investors.
📉 The recent decline could reflect:
Confusion around the transaction;
Weak hands exiting during the restructuring;
Lack of immediate liquidity for the spin-out shares.
⚒️ Riverside retains multiple strong projects in Mexico, significant working capital, and a royalty on Capitan Silver’s asset — another successful spin-out.
📊 With a market cap of only CAD $16.8M, the risk/reward appears skewed to the upside, especially if technicals confirm a reversal.
🔍 Worth watching as Blue Jay listing approaches. This setup reminds me of other profitable spin-out plays in the junior gold space.
