TORONTO & VANCOUVER, British Columbia -- (Business Wire)
Almonty Industries Inc. (TSX-V:AII) (“Almonty”) and Woulfe
Mining Corp. (CSE:WOF, Frankfurt:OZ4) (“Woulfe”) are pleased
to announce that they have entered into an arrangement agreement (the “Arrangement
Agreement”), pursuant to which Almonty and Woulfe will proceed with
a business combination in which Almonty will acquire all of the
outstanding common shares of Woulfe by way of a court approved plan of
arrangement (“Arrangement”).
Transaction Highlights:
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The offer price represents a 16.7% premium to the closing price of the
common shares of Woulfe on the Canadian Stock Exchange on July 6, 2015.
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The proposed Arrangement has received unanimous approval of the board
of directors of Almonty (Lewis Black abstaining).
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The proposed Arrangement has received unanimous approval of the board
of directors of Woulfe (Lewis Black abstaining), acting on advice of a
special committee comprised of four independent directors (the “Special
Committee”) after consultation with independent financial and
legal advisors.
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The Special Committee’s financial advisor, Jacob Securities Inc. (“Jacob
Securities”), has provided its verbal opinion that the
consideration to be received by Woulfe shareholders pursuant to the
terms of the Arrangement is fair, from a financial point of view, to
the Woulfe shareholders (other than Almonty and its affiliates).
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The proposed Arrangement delivers a premium to Woulfe shareholders and
the ability to unlock value in Almonty going forward. Almonty has a
proven management team with a strong track record of operational
success. Almonty’s assets are comprised of two producing mines in
Australia and Spain producing more than 1,800 tonnes of Tungsten per
year.
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The proposed Arrangement is expected to close in early September 2015,
subject to satisfaction of certain customary conditions.
Pursuant to the Arrangement Agreement, on closing each common share of
Woulfe will be exchanged for 0.1029 of a common share of Almonty. Based
on Almonty’s share price on July 6, 2015, this represents total
consideration of $0.07 per Woulfe share and a premium of 16.7% to
Woulfe’s closing price on July 6, 2015. Upon completion of the
Arrangement, Woulfe shareholders will own approximately 40.2% of the
combined businesses.
Lewis Black, President and CEO of Almonty, commented: “This transaction
represents the opportunity to combine one of the world’s most promising
undeveloped tungsten assets with our significant portfolio of producing
assets, to create a truly global tungsten powerhouse. Almonty has
already established itself as a leading producer of tungsten outside of
China and premier consolidator of global tungsten assets. With the
addition of Woulfe’s flagship Sangdong mine, we are confident about the
combined team’s ability to unlock significant value from our collective
assets for our combined shareholders.”
Brian Howlett, Chairman of the Special Committee of Woulfe, commented:
“We consider this to be a win-win for the shareholders of both
companies. For Woulfe shareholders, it provides an immediate premium
valuation, enhanced liquidity and participation in the growth of the
largest independent tungsten company outside of China at a time when
financing our continued operations has been very challenging.”
Woulfe’s principal asset is the 100%-owned Sangdong Tungsten/Molybdenum
Project (“Sangdong”) located in South Korea, located 187 km
southeast of Seoul (subject to a third party which may purchase a
25%-ownership interest in Sangdong for CAD$35 million). The property is
comprised of 12 Mining Rights with an aggregate area of 3,173 hectares.
Woulfe recently completed a 2015 Resource Update and Feasibility Study
in accordance with National Instrument 43-101 – Standards of
Disclosure for Mineral Projects (“NI 43-101”)on the
Sangdong mine, which is available on Woulfe’s SEDAR profile at www.sedar.com.
Almonty’s principal assets are the producing Los Santos tungsten mine in
Spain, and the producing Wolfram Camp tungsten and molybdenum mine in
Queensland Australia. In addition, Almonty is working towards the
commissioning of the Valtreixal tin/tungsten mine in northwestern Spain
with anticipated production in 2017. Technical reports in accordance
with NI 43-101 on each of Almonty’s principal assets are available on
Almonty’s SEDAR profile at www.sedar.com.
Transaction Overview
The proposed business combination transaction will be carried out by way
of a plan of arrangement under the provisions of the Business
Corporations Act (British Columbia). The implementation of the
Arrangement will be subject to approval of the TSX Venture Exchange, the
approval of the Supreme Court of British Columbia and the favourable
vote of shareholders of Woulfe at a special meeting, expected to be held
on or before September 8, 2015. In order to obtain the required
shareholder approval, a favourable vote of 66 2/3% of the votes cast at
the meeting, together with minority approval in accordance with
Multilateral Instrument 61-101 – Protection of Minority Security
Holders in Special Transactions (the “Woulfe Shareholder Approval”)
will be required. Pursuant to the terms of the Arrangement Agreement,
the proposed Arrangement is also subject to the satisfaction of certain
closing conditions customary for transactions of this nature.
The Arrangement Agreement also provides for customary support and
non-solicitation covenants from Woulfe (subject to standard “fiduciary
out” provisions that entitle Woulfe to accept a superior proposal and a
five business day “right to match” in favour of Almonty). The
Arrangement Agreement also provides for the payment of a termination fee
of CAD$770,000, representing approximately 3% of the equity value of
Woulfe, to Almonty if the proposed Arrangement is not completed in
certain specified circumstances.
The board of directors of each of Almonty and Woulfe, Lewis Black
abstaining, unanimously approved the terms of the proposed Arrangement
and in the case of the Woulfe board recommend that its shareholders vote
in favour of the proposed Arrangement. In the case of Woulfe, (i) the
Special Committee was formed to consider the proposed Arrangement and
make a recommendation to the board of directors of Woulfe; and (ii)
Lewis Black declared a conflict of interest and did not participate in
any discussions regarding, or approval of, the proposed Arrangement.
Jacob Securities was retained by the Special Committee to provide an
independent fairness opinion and has concluded that the consideration to
be received by shareholders of Woulfe (other than Almonty and its
affiliates) is fair, from a financial point of view, to such
shareholders. In the case of Almonty, Lewis Black declared his interest
and did not vote on the approval of the proposed Arrangement. Almonty
owns 29,497,229 common shares in the capital of Woulfe, representing
approximately 8% of the issued and outstanding common shares and holds
approximately 18.5% of the issued and outstanding common shares of
Woulfe on a partially diluted basis.
The directors and senior officers of Woulfe have entered into customary
voting support agreements pursuant to which, among other things, they
have agreed to vote their common shares of Woulfe (representing
approximately 0.16% of the outstanding common shares of Woulfe) in
favour of the proposed Arrangement.
The number of Almonty shares to be issued will be approximately
34,828,500, based on Woulfe’s currently outstanding common shares. Under
the plan of arrangement, upon closing, all outstanding Woulfe options
will be exchanged for Almonty options. All Woulfe warrants and
debentures will remain outstanding in accordance with their terms.
The terms and conditions for the Arrangement Agreement will be
summarized in Woulfe’s management information circular, which is
expected to be filed on SEDAR and mailed to shareholders of Woulfe in
early August 2015. If the Arrangement is approved by shareholders of
Woulfe, it is anticipated that the Arrangement will be completed in
early September 2015.
Copies of the Arrangement Agreement and certain related documents will
be filed with the Canadian securities regulators and will be available
on the SEDAR website at www.sedar.com.
The Woulfe management information circular will also be available at www.sedar.com.
This announcement is for informational purposes only and does not
constitute an offer to purchase, a solicitation of an offer to sell
shares or a solicitation of a proxy.
Advisors
Almonty’s legal advisor in Canada is Wildeboer Dellelce LLP, Osler,
Hoskin & Harcourt LLP in the United States and Kim & Chang in Korea and
Almonty’s financial advisor is Dundee Securities Ltd. Woulfe’s legal
advisors are Armstrong Simpson Legal Counsel in Canada and Lee
International IP & Law Group in Korea. Cassels Brock & Blackwell LLP
acts as independent legal advisors to the Special Committee and Jacob
Securities acts as financial advisor to the Special Committee.
About Almonty Industries Inc.
The principal business of Toronto, Canada-based Almonty Industries Inc.
is the mining, processing and shipping of tungsten concentrate from its
Los Santos Mine in western Spain and its Wolfram Camp Mine in north
Queensland, Australia. The Los Santos Mine was acquired by Almonty in
September 2011 and is located approximately 50 kilometres from Salamanca
in western Spain and produces tungsten concentrate. The Wolfram Camp
Mine was acquired by Almonty in September 2014 and is located
approximately 130 km west of Cairns in northern Queensland, Australia
and produces tungsten and molybdenum concentrate. Almonty also has an
option to acquire a 100% ownership interest in the Valtreixal
tin-tungsten project in north western Spain. Further information about
Almonty’s activities may be found at www.almonty.com
and under Almonty’s profile at www.sedar.com.
About Woulfe Mining Corp.
Woulfe Mining Corp., through its wholly-owned subsidiary Sangdong Mining
Corporation, is dedicated to developing the Sangdong tungsten-molybdenum
mine which was historically one of the largest tungsten mines in the
world and one of the few long life, high-grade tungsten deposits located
outside of China. Woulfe Mining Corp. is listed on the Canadian Stock
Exchange. Further information about Woulfe’s activities may be found at www.woulfemining.com
and under Woulfe’s profile at www.sedar.com.
Forward-Looking Information
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS: This news release
contains "forward-looking statements" within the meaning of the United
States Private Securities Litigation Reform Act of 1995 and
“forward-looking information” as such term is defined in applicable
Canadian securities laws (together referred to herein as
“forward-looking statements”). Except for statements of historical fact
relating to Almonty or Woulfe, information contained herein constitutes
forward-looking statements. Forward-looking statements are characterized
by words such as "plan," "expect", "budget", "target", "project",
"intend," "believe", "anticipate", "estimate" and other similar words,
or statements that certain events or conditions "may" or "will" occur.
Forward-looking statements in this news release include, but are not
limited to, statements regarding the completion of the Arrangement and
the expected benefits to Almonty shareholders and Woulfe shareholders of
the proposed Arrangement. Forward-looking statements are based on the
opinions, assumptions and estimates of management considered reasonable
at the date the statements are made, and are inherently subject to a
variety of risks and uncertainties and other known and unknown factors
that could cause actual events or results to differ materially from
those projected in the forward-looking statements. These factors include
(i) that Almonty and Woulfe will complete the proposed Arrangement
described herein, (ii) political developments, whether generally or in
respect of the mining industry specifically, in Spain, Australia and
South Korea, not consistent with Almonty and Woulfe’s current
expectations, (iii) Almonty’s and Woulfe’s expectations in connection
with the projects discussed herein being met, (iv) the impact of general
business and economic conditions, global liquidity and credit
availability on the timing of cash flows and the values of assets and
liabilities based on projected future conditions, fluctuating metal
prices and currency exchange rates, (v) changes in project parameters as
plans continue to be refined,(vi) the continued employment of key
Almonty and Woulfe employees, as well as those risk factors discussed or
referred to in Almonty’s and Woulfe’s respective annual Management’s
Discussion and Analysis and Almonty’s Annual Information Form for their
respective most recently completed year ends filed with the applicable
securities regulatory authorities and available at www.sedar.com.
Although Almonty and Woulfe have attempted to identify important factors
that could cause actual actions, events or results to differ materially
from those described in forward-looking statements, there may be other
factors that cause actions, events or results not to be anticipated,
estimated or intended.
There can be no assurance that forward-looking statements will prove to
be accurate, as actual results and future events could differ materially
from those anticipated in such statements. Neither Almonty nor Woulfe
undertakes any obligation to update forward-looking statements if
circumstances or management’s estimates, assumptions or opinions should
change, except as required by applicable law. The reader is cautioned
not to place undue reliance on forward-looking statements. The
forward-looking information contained herein is presented for the
purpose of assisting investors in understanding Almonty’s and Woulfe’s
expected financial and operational performance and results as at and for
the periods ended on the dates presented in their respective plans and
objectives and may not be appropriate for other purposes. Information
herein with respect to Almonty has been provided by management of
Almonty, and information herein with respect to Woulfe has been provided
by management of Woulfe, and neither Almonty nor Woulfe assumes any
responsibility or liability with respect to the other party’s
information set out herein or any obligation to update such information,
except as require by applicable securities laws.
View source version on businesswire.com: http://www.businesswire.com/news/home/20150707006650/en/
Contacts:
Almonty Industries Inc.
Dennis Logan, 647-432-9766
CFO and
Secretary
www.almonty.com
or
Woulfe
Mining Corp.
Mark Gelmon, 604-684-6264
CFO
www.woulfemining.com
Source: Almonty Industries Inc.
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