TORONTO - Canadian precious metals exploration company Exeter Resource Corp said on Tuesday its board has approved a plan to spin out its Cerro Moro gold-silver project in Argentina into a new company.

Vancouver, British Columbia-based Exeter will retain all assets relating to the Caspiche gold-copper project in Chile, together with about C$50 million in working capital, while the new company will be given C$25 million in working capital to focus on Cerro Moro and other exploration properties in Argentina.

Exeter said the proposed transaction will create more value for shareholders, who will be asked to vote on the proposal at a special shareholder meeting on March 4.

If approved, each share of Exeter will entitle the holder to one share in the new company. There will be no change in shareholder's holdings in Exeter.

The proposed transaction is also subject to the approval of the Toronto Stock Exchange, the NYSE Amex and the Supreme Court of British Columbia.

Shares of Exeter closed Monday at C$8.17 on the Toronto Stock Exchange. (Reporting by Euan Rocha)