KORE shareholders will receive shares in the new company on a pro-rata basis.

The main assets, FG Gold and Gold Creek, are part of a 1,000sq.km land package in the Cariboo Gold District, where other explorers have been investing heavily to the north.

Drilling earlier this year discovered the Lower Zone at FG Gold. The discovery was based on intercepts of 10m of 3.9 grams per tonne gold from 237m downhole, and 14.3m at 6.4g/t from 386m depth.

The company said the project's mineralising controls remained under-explored along the 110km trend, and five high-priority targets had already been identified.

Karus has results from 14 holes to be reported, and ongoing drilling at Gold Creek, for which results are expected through the first quarter next year.

Karus intends to undertake a rights offer early in 2021 to recapitalise the company. The board unanimously approved the transaction with the support of KORE's largest shareholder, Eric Sprott.

"I support management teams that actively work to generate shareholder value," said Sprott. "I am pleased to support this transaction to daylight value of Kore's strategic position in the Cariboo Gold District."

KORE owners will vote on the proposal during a virtual special shareholder meeting scheduled for January 20.

KORE shares (TSXV:KORE) advanced 5% on Wednesday to C$1.52, capitalising it at $161 million (US$126 million).