Gondwana Gold Announces Execution of Definitive Agreement with Pan
African Oil Ltd. to Acquire Oil and Gas Assets in Africa
TORONTO,
Nov. 19, 2012 /CNW Telbec/ -
Gondwana Gold Inc. (TSXV: GON) ("Gondwana" or the
"Corporation") is pleased to announce that it has executed a
definitive agreement dated November 19,
2012 with Pan African Oil Ltd. ("PAO") which
contemplates a three-cornered amalgamation whereby securityholders
of PAO will receive securities of Gondwana and PAO will become a
wholly-owned subsidiary of Gondwana (the
"Transaction"). Pursuant to the Transaction:
(i) each common share of PAO will be exchanged for 0.8 (the
"Exchange Ratio") of a common share of the Corporation; and
(ii) each convertible security of PAO will be exchanged for
similar convertible securities of the Corporation at the Exchange
Ratio.
PAO is a private company existing under the laws
of the province of British
Columbia incorporated on November 30,
2011. PAO is engaged in oil and gas exploration onshore and
offshore Africa. PAO's principal
asset is its 81% interest in two petroleum exploration licences for
blocks 2211 B, 2311 A and 2612 A in the Walvis & Lüderitz
Basins, Offshore Namibia. PAO has retained Petrotech Engineering
Ltd. to prepare a National Instrument 51-101 report on PAO's
Offshore Namibia properties.
The completion of the Transaction will be a
change of business for the Corporation pursuant to Policy 5.2 of
the TSX Venture Exchange, with the resulting focus of the
Corporation on the oil and gas industry.
Gondwana is currently a mining exploration
company with exploration properties located in Africa. Gondwana was incorporated on
July 24, 2007 and was listed as a
capital pool company on the TSX Venture Exchange on May 22, 2008. Gondwana completed its
qualifying transaction and was listed as a mining company on
September 3, 2010. Since
completing its qualifying transaction, the Corporation has been
focused on pursuing exploration and development opportunities
within the mining sector. For further information about the
Corporation and its activities, please refer to the Corporation's
website at www.gondwanagold.com as well as filings at
www.sedar.com.
Gondwana and PAO are arm's length parties, and
there are no non-arm's length parties of Gondwana who are insiders
of PAO or who presently hold any direct or indirect beneficial
interest in either PAO or any of its assets.
Gondwana currently has issued and outstanding:
i) 30,487,500 common shares; ii) stock options to acquire 225,000
common shares of Gondwana at $0.70
per share exercisable until August 19,
2016; and iii) stock options to acquire 150,000 common
shares of Gondwana at $0.70 per share
exercisable until February 24,
2017.
PAO currently has issued and outstanding: i)
34,140,000 common shares; ii) stock options to acquire 1,200,000
common shares of PAO at $0.25 per
share exercisable for ten years from the date of grant, being
March 22, 2012; iii) stock options to
acquire 450,000 common shares of PAO at $0.25 per share exercisable for ten years from
the date of grant, being May 14,
2012; iv) stock options to acquire 450,000 common shares of
PAO at the price of the next equity financing exercisable for ten
years from the date of grant, being May 14,
2012; v) warrants to acquire 10,640,000 common shares of PAO
at $0.40 per share exercisable for 24
months after closing of the Transaction; and vi) warrants to
acquire 851,200 units of PAO at $0.25
per unit exercisable for 24 months after closing of the
Transaction, with each unit exercisable into one common share of
PAO and one warrant to acquire one common share of PAO at
$0.40 per share exercisable for 24
months after closing of the Transaction.
Pursuant to the Transaction, Gondwana will issue
approximately 27,312,000 common shares and 10,872,960 securities
convertible, exchangeable or exercisable into common shares of
Gondwana to holders of PAO common shares and PAO convertible
securities, respectively. It is anticipated that immediately
following the closing of the Transaction, the Corporation will have
approximately 57,799,500 common shares issued and outstanding
(69,728,420 on a fully diluted basis, assuming exercise of all then
outstanding options and warrants, including the warrants underlying
the units issuable upon exercise of certain warrants).
Completion of the Transaction is subject to a
number of conditions, including the approval of the TSX Venture
Exchange, the requisite approval of shareholders of each of
Gondwana and PAO, the approval of the board of directors of
Gondwana, the completion of satisfactory due diligence by Gondwana
and PAO, and other customary closing conditions.
PowerOne Capital Markets Limited acted as PAO's
financial advisor in connection with the Transaction. Clarus
Securities Inc. acted as the Corporation's financial advisor in
connection with the Transaction.
Following the closing of the Transaction, it is
proposed that the board of directors of the Corporation shall be
reconstituted to consist of five members who are reasonably
acceptable to the TSX Venture Exchange, which will include (a)
three nominees of PAO, namely Bongani Mtshisi, Gary Wine and one additional nominee of PAO to
be mutually agreed upon by the parties; (b) one nominee of the
Corporation, namely the Corporation's current Chairman,
J.D. Miller; and (c) one mutually
agreed upon independent director. The biographies of the
anticipated directors and members of senior management of Gondwana
following closing of the Transaction are as follows:
J.D. Miller -
Director (Montreal, Quebec,
Canada)
Mr. Miller's professional expertise spans 30
years of experience in the areas of strategic planning, financial
architecture and management including over ten years experience in
African based matters. His mandates have centered around
complex commercial situations in the steel, healthcare, and natural
resource sectors. During the period from 1987 until its time
of acquisition in 1990 by Ingram & Bell, a wholly-owned
subsidiary of MDS (TSE), he served as the President and Chief
Executive Officer of Mavtech Holdings Inc. (TSE & ME).
Mr. Miller is known for his work in community affairs as well as
for his support of amateur sport across Canada with B2ten. He was educated at
the Choate School in Wallingford,
Connecticut and the University of
Pennsylvania in Philadelphia.
Bongani Mtshisi - Director (Johannesburg, Gauteng, South Africa)
Mr. Mtshisi is a Mining Engineer by training and
has worked in key commodities such as Platinum, Gold, Diamond,
Nickel and Copper with such companies as Anglo Platinum,
Debeers/HUF and Sub Nigel Gold. Mr. Mtshisi is CEO of BSC
Resources LTD, a company which is responsible of exploration and
development of copper and nickel commodities in South Africa. Mr. Mtshisi was also a founding
member of Auryx Gold Corp (TSX. AYX) a leader in Namibian gold
exploration. Mr. Mtshisi has demonstrated his ability to
identify sound exploration projects and structure teams to drive
projects up the value curve in the projects that he has
spearheaded, creating value for shareholders.
Gary Wine -
Director and Chief Executive Officer (Calgary, Alberta, Canada)
Mr. Wine is a geologist by training with over 35
years in the oil exploration business and has been directly
responsible for numerous oil and gas discoveries throughout his
career. Previously, Mr. Wine was President and Chief
Operating Officer of Petrolifera Petroleum Limited whom he helped
to found, and grow the company at one point to a market
capitalization of approximately $1
billion. Mr. Wine presided in his position of
President until the company was sold in March 2011. Mr. Wine has extensive
exploration experience worldwide which has included various
countries in South America,
Asia and Europe.
Willie Viviers
- Chief Financial Officer (Cape
Town, Western Cape, South
Africa)
Mr. Viviers is a chartered accountant and served
for 13 years as a partner with PricewaterhouseCoopers in
South Africa specializing in
corporate governance and risk management services. Mr. Viviers then
joined the Strategy Partners Group where he assisted various
businesses with optimization strategies while fulfilling interim
Chief Financial Officer and Financial Director positions in
organizations experiencing growth or structural problems. In 2009,
he joined the Bright Equity Group, a founding shareholder of Auryx
Gold Corp. He consulted to the Auryx Gold group and was the Interim
CFO of Auryx Gold Corp. until it was taken over by B2Gold Corp. He
still consults to the Auryx Gold group and is the Financial
Director of the operating subsidiaries.
Phil Miller -
Vice-President, Exploration (Calgary,
Alberta, Canada)
Mr. Miller brings 30 years of world-wide
experience to advance and guide the company's exploration plans. He
has extensive African experience and has been involved in a number
of significant discoveries in Nigeria. In addition he has evaluated
opportunities and managed exploration campaigns in many other areas
of the world, including the Middle
East, the deep water Gulf of
Mexico, North Sea, offshore South
America, Argentina,
Southeast Asia, and Australia. A geophysicist by training, Mr.
Miller joined PAO from Nexen where he directed the evaluation of
new business opportunities as Exploration Manager for Global New
Ventures.
The Corporation intends to apply for an
exemption from the sponsorship requirements of the TSX Venture
Exchange in connection with the Transaction. There is no
assurance that such exemption will be granted.
Completion of the Transaction is subject to a
number of conditions, including TSX Venture Exchange acceptance and
disinterested Shareholder approval. The Transaction cannot
close until the required Shareholder approval is obtained.
There can be no assurance that the Transaction will be completed as
proposed or at all.
Investors are cautioned that, except as
disclosed in the Filing Statement to be prepared in connection with
the transaction, any information released or received with respect
to the Change of Business may not be accurate or complete and
should not be relied upon. Trading in the securities of
Gondwana Gold Inc. should be considered highly speculative.
Certain statements contained in this release
constitute forward-looking information. These statements relate to
future events or the Corporation's future performance. The
use of any of the words "could", "expect", "believe", "will",
"projected", "estimated" and similar expressions and statements
relating to matters that are not historical facts are intended to
identify forward-looking information and are based on the
Corporation's current belief or assumptions as to the outcome and
timing of such future events. Actual future results may
differ materially. In particular, the Corporation's stated
expectation as to the completion of the Transaction is a statement
containing forward-looking information. Actual results and
developments may differ materially from those contemplated by this
forward-looking information depending on, among other things, the
risks that the parties will not proceed with the Transaction, that
the ultimate terms of the Transaction will differ from those that
are currently contemplated and that the Transaction will not be
successfully completed for any reason (including the failure to
obtain the required approvals or clearances from regulatory
authorities). The Corporation disclaims any intention or
obligation to publicly update or revise any forward-looking
information, whether as a result of new information, future events
or otherwise, except as may be expressly required by applicable
securities laws.
The TSX Venture Exchange has in no way passed
upon the merits of the proposed transaction and has neither
approved nor disapproved the contents of this press
release.
Neither TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in policies
of the TSX Venture Exchange) accepts responsibility for the
adequacy or accuracy of this release.
SOURCE Gondwana Gold Inc.