Gold explorer, Carrick Gold (CRK) will spin off its nickel based assets to a wholly-owned subsidiary, Condor Nickel Ltd, in order to focus on its gold activities.
Carrick had acquired fellow gold explorer Shannon Resources in 2007 and in doing so considerably expanded its nickel resources and targets.
"However, Carrick and its shareholders have not witnessed a direct benefit as a result of the enormous nickel resource believed to exist among the combined tenements," Carrick said in a statement.
At a time when market analysts are predicting the spot price of gold to go as high US$1100 an ounce, mining companies are seeking to take advantage of this.
"The gold price is at record highs, as a result of which and the decision to spin-off its nickel assets, CRK will concentrate exclusively on gold," CRK said.
"Directors of CRK believe that the continuing exploration success of the company's gold activities will be better reflected in the share price if the company maintains an exclusive gold focus."
"Therefore, CRK will in future, concentrate solely on gold discovery with a view to becoming a substantial gold producer in the near term."
The price of nickel has been falling in recent times and this can offset any potential value from production outcome.
Nickel Futures fell by almost 2% overnight on the London Metals Exchange.
CRK said it intends to make application to list Condor Nickel on the Australian Stock Exchange through an initial public offering of 40,000 ordinary shares at 20 cents each.
CRK shareholders will receive 1 Condor share for every 5 Carrick Gold shares they own.
Carrick's primary exploration project is the Lindsay Find tenement located in the Eastern Goldfields of Western Australia.
Carrick has grown since it first listed on the ASX in 2005 at 20 cents a share. Its market capitalisation is now about $215 million.
Shares in CRK fell 5 cents to $1.71.
