Anfield Announces Sale of Mayaniquel S.A. to Cunico Resources N.V.
VANCOUVER, BRITISH COLUMBIA--(Marketwired - Apr 24, 2014) -
Anfield Nickel Corp. ("Anfield") (TSX-VENTURE:ANF) and Cunico
Resources N.V. ("Cunico") announced today that they have entered
into an agreement whereby Cunico will acquire Anfield's Guatemalan
subsidiary, Mayaniquel S.A., and its Mayaniquel nickel laterite
project. Under the agreement, Cunico will acquire Mayaniquel S.A.
for a purchase price dependent upon the prevailing nickel price
five years from the closing date of the proposed transaction. The
transaction is arm's length.
Payment will be made in five annual $3 million installments
totalling $15 million (all dollar amounts are in US dollars unless
otherwise stated) commencing on closing of the transaction and a
final payment of $28 million on the fifth anniversary of the
closing date, subject to adjustment based on the following formula:
(Year 5 average nickel price / $14,000 x $43 million) - $15
million. For example, if the average nickel price in the fifth year
following closing is the current price of $18,364/tonne, the final
payment would be $41.4 million and the total purchase price would
be approximately $56.4 million (Cdn $62 million).
If the fifth year average nickel price exceeds $30,000/tonne, a
bonus adjustment of 15% will be added to the purchase price. For
example, if the average price in the fifth year is $30,001 the
final payment would be $91 million and the total purchase price
would be approximately $106 million (Cdn $117 million).
The average annual nickel price over the last 10 years has been
approximately $20,100 per tonne and ranged from a high of $37,230
per tonne in 2007 to a low of $13,800 per tonne in 2004.
Cunico's payment of future purchase price installments will be
secured by a pledge on the shares of Mayaniquel S.A. and a pledge
by Cunico's marketing subsidiary on certain accounts receivable
arising from the sale of processed nickel.
The share purchase agreement provides for, among other things,
customary board support and non-solicitation covenants on the part
of Anfield (subject to "fiduciary out" provisions that entitle
Anfield to consider and accept a superior proposal and a five
business day "right to match" any superior proposal in favour of
Cunico) as well as a termination fee of $2.15 million in certain
circumstances.
Closing of the transaction is subject to customary conditions,
including approval by two-thirds of Anfield's shareholders voting
at a special meeting and the TSX Venture Exchange accepting notice
of the transaction. Holders of approximately 50% of Anfield's
outstanding shares (including all of Anfield's Directors and
Officers and Ross J. Beaty) have agreed to vote in favour of the
transaction. No finder's fees are payable in connection with the
transaction.
The Board of Directors of Anfield, after consultation with its
financial and legal advisors and based, in part, upon the unanimous
recommendation of an independent committee of the Board, has
determined unanimously that the purchase price to be received by
Anfield is fair and that the transaction is in the best interest of
Anfield. Anfield has engaged Salman Partners Inc. to provide an
opinion that the transaction is fair, from a financial point of
view, to Anfield.
Anfield will use proceeds from the transaction to repay
outstanding indebtedness, fund ongoing general and administrative
expenses and finance future acquisitions. As the Mayaniquel project
represents substantially all of Anfield's business undertaking,
Anfield's management will be seeking other mineral development
projects for Anfield to invest in post-closing.
While Anfield will look at different options to invest in and
carry on an active business, it cannot provide any assurance that
an active or liquid market for its common shares will develop or be
sustained after closing of the transaction.
Borden Ladner Gervais LLP are acting as legal counsel to
Anfield's independent committee. Baker & McKenzie LLP are
acting as legal counsel to Cunico.
Full details of the transaction will be included in an
information circular to be mailed to Anfield's shareholders in
accordance with applicable securities laws. Copies of the share
purchase agreement, the information circular and certain related
documents and agreements will be filed with Canadian securities
regulators and will be available at the SEDAR website at
www.sedar.com under Anfield's profile. The transaction is expected
to close on or before June 15, 2014.
About Cunico
Cunico Resources NV is an Amsterdam, Netherlands domiciled
international mining and metallurgical company, engaged in the
exploration, mining and production of ferro-nickel. It is the
largest ferro-nickel producer in Europe and the fourth largest in
the world.
About
Anfield
Anfield is a Vancouver and Guatemala based nickel exploration
company that controls the Mayaniquel nickel laterite project
located in eastern Guatemala. The company's shares are traded on
the Toronto Stock Exchange (Venture Exchange). The company has
43,401,966 shares issued and outstanding and 46,591,966 issued and
outstanding on a fully diluted basis.
Anfield Nickel Corp.
David Strang, Chairman
CAUTION REGARDING FORWARD LOOKING STATEMENTS:
Information and statements contained in this news release that
are not historical facts are "forward-looking information" or
"forward-looking statements" within the meaning of applicable
Canadian securities legislation and the United States Private
Securities Litigation Reform Act of 1995, respectively, and involve
risks and uncertainties. Examples of forward-looking information
and statements contained in this news release include information
and statements with respect to:
- the timing and completion of Anfield's sale of Mayaniquel
S.A. to Cunico;
- the amount, timing and payment of the purchase price
installments from Cunico to Anfield;
- the receipt of regulatory, shareholder and other approvals
for Anfield's sale of Mayaniquel S.A. to Cunico;
- Anfield's use of the proceeds from the sale of Mayaniquel
S.A.;
- the provision by Salman Partners Inc. of a fairness
opinion;
- whether Anfield will identify and invest in mineral
development projects post-closing; and
- whether an active or liquid market for Anfield's common
shares will develop or be sustained after closing of the
transaction
In certain cases, forward-looking information can be
identified by the use of words such as "is expected", "proposed" or
variations (including negative variations) of such words and
phrases or may be identified by statements to the effect that
certain actions, events or results, "may", "would", "will be" or
"shall" be taken, occur or be achieved.
Various assumptions or factors are typically applied in
drawing conclusions or making the forecasts or projections set out
in forward-looking information and statements. In some instances,
material assumptions and factors are presented or discussed in this
news release in connection with the statements or disclosure
containing the forward-looking information and statements. You are
cautioned that the following list of material factors and
assumptions is not exhaustive. The factors and assumptions include,
but are not limited to, assumptions concerning: nickel prices;
currency exchange rates; the receipt of regulatory, shareholder and
other approvals for Anfield's sale of Mayaniquel, S.A. to Cunico;
and closing conditions to the sale of Mayaniquel S.A. to Cunico
being met.
Forward-looking statements are subject to a variety of known
and unknown risks, uncertainties and other factors which could
cause actual events or results to differ materially from those
expressed or implied by the forward-looking statements, including,
without limitation:
- risks relating to nickel, iron and other mineral price
fluctuations;
- risks relating to currency exchange rate
fluctuations;
- risks of Cunico defaulting on future purchase price
installments;
- risks as to the enforceability of Anfield's security for
payment of future purchase price installments;
- risks that closing conditions to the sale of
Mayaniquel S.A. to Cunico are not met; and
- risks that prospective mineral development projects cease
to be available for investment by Anfield.
This list is not exhaustive of the factors that may affect
the forward-looking information and statements contained in this
news release. Should one or more of these risks and uncertainties
materialize, or should underlying assumptions prove incorrect,
actual results may vary materially from those described in the
forward-looking information and statements. The forward-looking
information and statements contained in this news release are based
on beliefs, expectations and opinions as of the date of this news
release. For the reasons set forth above, readers are cautioned not
to place undue reliance on forward-looking information. Anfield
does not undertake to update any forward-looking information and
statements included herein, except in accordance with applicable
securities laws.
Neither the 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 news release.
Anfield Nickel Corp.David StrangChairman+ 604 646 1899+ 604 687
7041dstrang@anfieldnickel.com
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