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TORONTO, Sept. 23, 2014 /CNW/ - Almonty Industries Inc.
("Almonty" or the "Company") (TSXV: AII) announces
that on September 22, 2014 it closed
the previously announced acquisition of 100% of both Wolfram Camp
Mining Pty Ltd and Tropical Metals Pty Ltd (which collectively own
100% of the Wolfram Camp tungsten and molybdenum mine in
Queensland, Australia
("WCM")) for CAD$18.0 million
(the "Acquisition") from Deutsche Rohstoff AG
("DRAG"). The purchase price of CAD$18.0 million was satisfied as follows:
- Almonty issued to DRAG 12,209,302 common shares at a value of
CAD$0.86 per share that represents
approximately CAD$10.5 million and
translates into a shareholding of 24.9% of Almonty's total
outstanding common shares.
- Almonty issued a convertible debenture to DRAG in the principal
amount of CAD$7.5 million. The
convertible debenture has a maturity of 2.5 years with a coupon of
4%. The convertible debenture may be converted, at the option of
DRAG, into common shares of Almonty at a conversion price of
CAD$1.45 per Almonty share.
Concurrent with the closing of the Acquisition, Almonty entered
into a new Supply Agreement with Global Tungsten & Powders
Corp. ("GTP") for the output from WCM.
Almonty has also entered into a long-term US$10.0 million loan agreement with UniCredit
Bank AG ("UniCredit"), whereby Almonty will utilize the loan
proceeds to refurbish the operations of WCM and extend the mine
life. Funding from the loan is expected to provide sufficient
capital to see the optimization of WCM through to positive cash
flow. Principal and interest under the loan is due to
UniCredit under a balloon payment structure. The loan carries
an interest rate of LIBOR plus a spread of less than 2% and is
indirectly guaranteed by GTP. Should GTP repay some or all of
the amounts owing under the loan agreement with UniCredit on
Almonty's behalf, then GTP will have the right to be issued a
convertible note in respect of such amounts. The issuance of
any such future convertible note will be subject to the prior
approval of the TSX Venture Exchange.
Lewis Black, Chief Executive
Officer of Almonty commented, "We are pleased to have been able to
close the acquisition of 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. Our technical
team has spent the past 3 months preparing for the acquisition and
we are looking forward to embarking on the task of replicating the
success we have enjoyed at the Los Santos Project at WCM. We also
are pleased to welcome DRAG as a major shareholder in Almonty,
allowing DRAG and its shareholders to maintain their tungsten
exposure in a much larger entity. We believe that Almonty is
the only listed company on the TSX/TSX-V with two operating
tungsten mines, producing both scheelite and wolframite
concentrate, and this acquisition is the first step in the next
chapter of Almonty's growth strategy.
Furthermore, we are pleased to have been able to reach an
understanding with GTP, one of the world's largest consumers of
tungsten concentrate, with respect its willingness to back Almonty,
further demonstrating GTP's faith in the Almonty team's ability to
deliver reliable sources of tungsten concentrate supply from
current and future projects."
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.
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, the financing and the
refurbishment of and extension of the mine life of the Wolfram Camp
Mine. 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 include that no other current
TSX/TSX-V listed tungsten company acquires or places a second
tungsten mine into production 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.