VANCOUVER, Dec. 9 /CNW/ - Evolving Gold Corp. (TSX: EVG) (FSE: EV7) (the "Company" or "Evolving Gold") is pleased to announce a proposed dividend-in-kind spin out transaction (the "Spin Out") involving the transfer of the Company's option to acquire the mineral claims forming the Kiyuk Lake gold property in southern Nunavut (the "Kiyuk Property") to a new company, Prosperity Goldfields Corp. ("Prosperity"). Evolving Gold will distribute common shares of Prosperity (the "Prosperity Shares") to Evolving Gold shareholders by way of a dividend-in-kind, subject to applicable securities laws and receipt of securities regulatory approval, with a proposed basis of one Prosperity Share for every ten Evolving Gold shares. Prosperity is currently a wholly-owned subsidiary of the Company, and upon completion of the Spin Out, the Company expects Prosperity to become a publicly traded company. The Company believes that the creation of Prosperity will provide a mechanism for Evolving Gold shareholders to realize the full market value of the Kiyuk Property.