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TORONTO,
June 30, 2014 /CNW/ - Almonty
Industries Inc. ("Almonty" or the "Company") (TSXV: AII) announces
that it has entered into a binding Letter Agreement ( the
"Agreement") with Deutche Rohstoff AG ("DRAG") to
acquire 100% of both Wolfram Camp Mining Pty and Tropical Metals
Pty. (which collectively own 100% of the Wolfram Camp
tungsten and molybdenum mine in Queensland, Australia "WCM") for
CAD$18.0 million ( the
"Acquisition"). The Agreement calls for the purchase
price of CAD$18.0 million to be
satisfied as follows:
- Almonty will issue approximately 12,209,302 million common
shares at a value of $0.86 per share
that represent approximately CAD$10.5
million and translate into a shareholding of Almonty`s
issued stock of 24.9% following completion of the acquisition.
- The remaining purchase price of approximately CAD$7.5 million will be satisfied by Almonty
issuing a convertible debenture to DRAG. The convertible
debenture will have a maturity of 2.5 years with a coupon of 4%.
The convertible debenture may be converted, at the option of DRAG,
into shares of Almonty at a conversion price of CAD$1.45 per Almonty share.
Completion of the Acquisition will be
conditional on approval by the TSX Venture Exchange and approval of
Almonty shareholders.
Lewis Black,
Chief Executive Officer of Almonty commented, "We are pleased to
have been able to reach an agreement with DRAG to acquire the
Wolfram Camp mine, almost doubling the size of Almonty's tungsten
operations. WCM is currently producing to similar levels that
were being produced at the Los Santos Project when we acquired it
in 2011. We expect to be able to replicate the success we have
enjoyed at the Los Santos Project at WCM over a shorter time
frame. WCM is a wolframite producing mine which we consider
to be similar in many respects to the Panasqueira project that was
previously successfully renovated and subsequently sold by the
current Almonty management team when it was held by Primary Metals
Inc. Our technical team, having spent the majority of their
careers working with wolframite ore, and now scheelite ore at the
Los Santos Project, is highly confident regarding the upside
potential of WCM. The addition of DRAG as a major shareholder in
Almonty is also welcome and will allow DRAG and its shareholders to
maintain their tungsten exposure in a much larger entity.
Upon completion of the transaction Almonty will be the only
listed company on the TSX/TSX-V with two operating tungsten mines,
producing both scheelite and wolframite concentrate. Almonty's
endorsement from DRAG is yet another testament to the Almonty
team's ability to deliver a reliable source of tungsten supply from
its existing and future projects. This Acquisition is the
first step in the next chapter of Almonty's growth strategy."
About Almonty
The principal business of Toronto, Canada based Almonty Industries Inc.
(TSX-V: AII) is the mining, processing and shipping of tungsten
concentrate from its tungsten mine at the Los Santos Project.
The Los Santos Project was acquired by Almonty in September 2011. The Los Santos Project is
located approximately 50 kilometres from Salamanca in western
Spain and produces tungsten
concentrate. Almonty also has an option to acquire a 100% ownership
interest in the Valtreixal tin-tungsten project in north western
Spain. Management and
certain members of Almonty's Board of Directors led the turnaround
and eventual sale of Primary Metals Inc., the operator of the
Panasqueira Tungsten Mine in Portugal from 2003 to 2007. Further
information about the company's activities may be found at
www.almonty.com and under the company's profile at
www.sedar.com.
Neither TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
The Acquisition is subject to the approval of
the TSX Venture Exchange and any shareholder approval requirements
required by law or the TSX Venture Exchange.
This announcement is not intended to, and
does not, constitute or form part of (i) an offer or invitation to
purchase or otherwise acquire, subscribe for, tender, exchange,
sell or otherwise dispose of any securities, (ii) the solicitation
of an offer or invitation to purchase or otherwise acquire,
subscribe for, tender, exchange, sell or otherwise dispose of any
securities, or (iii) the solicitation of any vote or approval in
any jurisdiction, pursuant to this announcement or
otherwise.
The distribution of this announcement in or
into certain jurisdictions may be restricted by the laws of those
jurisdictions. Accordingly, copies of this announcement are not
being, and must not be, mailed or otherwise forwarded, distributed
or sent in, into or from any jurisdiction where it would be
unlawful to do so. Persons receiving such documents (including,
without limitation, nominees, trustees and custodians) should
observe these restrictions. Failure to do so may constitute a
violation of the securities laws of any such jurisdiction.
Disclaimer for Forward-Looking
Information
When used in this press release, the words
"estimate", "project", "belief", "anticipate", "intend", "expect",
"plan", "predict", "may" or "should" and the negative of these
words or such variations thereon or comparable terminology are
intended to identify forward-looking statements and information.
This press release contains forward-looking statements and
information including, without limitation, the Acquisition,
issuance of Almonty shares and convertible debentures and the
assumption of debt. These statements and information are based on
management's beliefs, estimates and opinions on the date that
statements are made and reflect Almonty's current
expectations.
The forward-looking statements and
information in this press release include information relating to
the intentions of management. Such statements and information
reflect the current view of Almonty with respect to risks and
uncertainties that may cause actual results to differ materially
from those contemplated in those forward-looking statements and
information. By their nature, forward-looking statements
involve known and unknown risks, uncertainties and other factors
and assumptions which may cause actual results, performance or
achievements, or other future events, to be materially different
from any future results, performance or achievements expressed or
implied by such forward-looking statements.
Investors are cautioned against attributing
undue certainty to forward-looking statements. Almonty cautions
that the foregoing list of material factors is not exhaustive. When
relying on Almonty's forward-looking statements and information to
make decisions, investors and others should carefully consider the
foregoing factors and other uncertainties and potential
events.
Almonty has also assumed that material
factors and assumptions will not cause any forward-looking
statements and information to differ materially from actual results
or events. These factors and assumptions including the Acquisition
being completed as contemplated pursuant to the terms of the
Agreement; that no other current TSX/TSX-V listed tungsten company
acquires or places a second tungsten mine into production prior to
the closing of the Acquisition and that no company with two or more
producing tungsten mines is newly listed on the TSX/TSX-V exchange;
that the Company is able to grow its production and acquire
additional mineral producing properties in the future; and that the
Company is able to effect a material improvement in the existing
production rate and cost profile at WCM. However, the list of
these factors is not exhaustive and is subject to change and there
can be no assurance that such assumptions will reflect the actual
outcome of such items or factors.
THE FORWARD-LOOKING INFORMATION CONTAINED IN
THIS PRESS RELEASE REPRESENTS THE EXPECTATIONS OF ALMONTY AS OF THE
DATE OF THIS PRESS RELEASE AND, ACCORDINGLY, IS SUBJECT TO CHANGE
AFTER SUCH DATE. READERS SHOULD NOT PLACE UNDUE IMPORTANCE ON
FORWARD-LOOKING INFORMATION AND SHOULD NOT RELY UPON THIS
INFORMATION AS OF ANY OTHER DATE. WHILE ALMONTY MAY ELECT TO, IT
DOES NOT UNDERTAKE TO UPDATE THIS INFORMATION AT ANY PARTICULAR
TIME EXCEPT AS REQUIRED IN ACCORDANCE WITH APPLICABLE LAWS.
SOURCE Almonty Industries Inc.