September 12, 2018 / 4:19 PM / 14 days ago

Canadian miner New Gold miner explores sale, sources say

TORONTO, Sept 12 (Reuters) - Canadian miner New Gold Inc is exploring a sale as it grapples with ballooning development costs and operating challenges at its new mine, people familiar with the situation told Reuters.

Toronto-based New Gold, which is working with investment bank BMO Capital Markets to help find a buyer and evaluate other options, has held talks with interested parties, the sources said this week. There were no assurances the talks would result in a deal, they added, declining to be identified as the discussions are private.

The company could divest specific mines if an outright sale does not materialize, one of the people said, noting its New Afton mine in British Columbia and Mesquite mine in California may be appealing on a standalone basis.

“New Gold’s corporate policy is not to comment on market rumors,” New Gold spokeswoman Julie Taylor said. BMO declined to comment. ($1 = 1.3003 Canadian dollars) (Reporting by John Tilak and Susan Taylor in Toronto Editing by Denny Thomas and Jeffrey Benkoe)

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