SEC halts Southridge shares after Kinross denies partnership
(Reuters) - Market regulators temporarily suspended the trading of shares of Southridge Enterprises Inc two days after the exploration company said it was forming a partnership with Kinross Gold Corp, which the Canadian gold miner has denied.
The U.S. Securities and Exchange Commission said in a statement on Friday that it had halted trading through January 11, 2013, due to "questions regarding the accuracy of statements made by Southridge ... concerning, among other things, the company's business operations and arrangements, including certain claims regarding a joint partnership."
Southridge said on December 26 that it was forming a joint partnership with Kinross, one of Canada's top gold miners, to develop its Cinco Minas and Gran Cabrera properties in Mexico.
The Dallas-based exploration company said the partnership was valued at some $550 million-$600 million, far higher than its total market capitalization of about $3 million.
Kinross, on Thursday, denied any partnership or joint venture, and said it has no plans to enter any transaction or agreement with the smaller company in the foreseeable future.
The Toronto-based company also said a quote attributed to Kinross geologist Martin Moscosa in the Southridge release "was incorrectly attributed to him."
In an email to Reuters on Friday, Southridge President Michael Davies said the company has two signed agreements from Moscosa and emails confirming his quote. Davies did not respond to a request to see copies of the emails or agreements.
Kinross declined further comment on Friday.
Shares of Southridge, a penny stock, were halted on Friday at 0.6 cent. The stock hit 1.5 cents in heavy trade on Wednesday after the company issued its news release.
Kinross' shares were not affected.
(Reporting by Julie Gordon; Editing by Bob Burgdorfer)