TORONTO, Dec. 23, 2014
/CNW/ - Alexandria Minerals Corporation (TSXV: AZX) (Frankfurt:
A9D) ("Alexandria") and
Murgor Resources Inc. (TSXV: MGR) ("Murgor") are
pleased to announce that they have entered into an arrangement
agreement (the "Arrangement Agreement") pursuant to which
Alexandria will acquire all of the
outstanding common shares of Murgor
(the "Murgor Shares") by way of a plan of
arrangement under the Canada Business Corporations Act
(the "Arrangement").
Summary of Transaction Terms
- Alexandria to acquire Murgor
for all-share consideration: Murgor shareholders to receive 0.5 of
an Alexandria share for each
Murgor share, representing a premium of approximately 50% over
current market price.
- Directors, officers and certain significant shareholders of
Murgor, representing 10.1% of the outstanding Murgor shares, have
agreed to support the transaction.
- Following completion of the transaction, current Murgor
shareholders will own approximately 25.7% of the outstanding
Alexandria shares.
- Following final Murgor shareholder approval, the subsequent
Company will have significant Gold-Copper mineral resources in the
well-known Canadian mining districts of Val d'Or, Quebec, and in Flin Flon and Snow
Lake, Manitoba.
Eric Owens, President and CEO of
Alexandria, in his assessment of
the acquisition stated, "This is a great transaction for
shareholders of both Alexandria
and Murgor, as both substantially increase their exposure to
additional mineral resources with minimal cost. We are building for
the future with this acquisition, in anticipation of improved
markets."
André C. Tessier, President and
Chief Executive Officer of Murgor, said, "We believe the enlarged
Alexandria gold and copper
exploration and development company will have a greater market
visibility and penetration, allowing the company to move forward
with more certainty for the development of the quality assets in
its portfolio. The Board of Directors of Murgor supports the
Arrangement and is committed to the success of the new enlarged
company. The opinion received from our independent financial
advisor, RWE Growth Partners, Inc., confirms that the Arrangement
is fair to Murgor shareholders. While we recognize the difficult
market trading and financing environment for junior exploration
companies at present, we believe the quality of the combined assets
of the two companies will allow value to be unlocked in the
future."
Summary of Transaction Benefits
- Combination of the two companies each with significant mineral
resources will lead to a substantial increase in mineral resources
for the combined company
- The increase in resources resulting from the combination will
occur at a substantially lower cost than equivalent
exploration
- In addition to exploration properties in the well-known and
prolific mining camps of Red Lake,
Ontario, and Flin
Flon-Snow Lake, Manitoba,
larger combined strategic land packages will form in Matachewan, Ontario, Chibougamau, Québec and Val d'Or, Québec where both companies have
land assets
- Management with successful track record of capitalizing
exploration projects as shown by Alexandria's discovery and sale of the West
Zone Au-Cu deposit (Alexandria Press Release January 13, 2014)
- Maintaining a Made-in-Canada
approach, one of the world's safest and most reliable
jurisdictions
More Resources Under One Roof
In addition to combining
strategically situated exploration properties in well-known
Canadian mining districts of Quebec, Manitoba and Ontario, the proposed transaction also brings
together mineral resources with much upside potential. Currently,
Alexandria Minerals reports the following resources according to
National Instrument ("NI") 43-101 Standards of Disclosure for
Mineral Projects on its large, 35 km long Cadillac Break Property
Package in Val d'Or, Quebec:
|
Measured
|
Indicated
|
Inferred
|
|
Tonnes
|
Grade
(g/t
Au)
|
Au
(oz.)
|
Tonnes
|
Grade
(g/t
Au)
|
Au
(oz.)
|
Tonnes
|
Grade
(g/t
Au)
|
Au
(oz.)
|
Akasaba
Underground
|
|
|
|
609,274
|
5.93
|
116,158
|
1,475,622
|
5.58
|
264,886
|
Akasaba Open
Pits
|
|
|
|
3,009,214
|
1.37
|
132,475
|
219,882
|
1.93
|
13,653
|
Orenada
|
4,148,739
|
1.44
|
192,101
|
6,125,236
|
1.29
|
254,790
|
7,399,643
|
1.27
|
302,469
|
Sleepy
(uncapped)
|
|
|
|
|
|
|
1,885,500
|
5.10
|
307,350
|
Notes to
table:
|
1.
|
Resources for Akasaba
(2013) and Sleepy (2014) calculated by Christian d'Amours of
Geopointcom, and for Orenada (2009), Geologica, Inc.
|
2.
|
Cut-Off grades used:
Akasaba Undereground, 2.25 g/t Au; Akasaba Open Pits and Orenada,
0.50 g/t; Sleepy, 3.00 g/t Au.
|
3.
|
Mineral resources
which are not mineral reserves have not demonstrated economic
viability. The estimate of mineral resources may be materially
affected by environmental, permitting, legal, title, taxation,
sociopolitical, marketing, or other relevant issues, although the
Company is not aware of any such issues.
|
4.
|
The quantity and
grade of reported inferred resources in this estimation are
uncertain in nature and there has been insufficient exploration to
define these inferred resources as an Indicated or Measured mineral
resource and it is uncertain if further exploration will result in
upgrading them.
|
5.
|
Eric Owens, President
and CEO, PGeo, and Philippe Berhtelot, Vice President Exploration,
PGeo, are the Qualified Persons for the technical contents
presented in this press release and have approved of the disclosure
of this information herein.
|
Murgor currently reports resources according to NI 43-101
Standards of Disclosure for Mineral Projects from its WIM and
Hudvam projects in the Snow Lake
and Flin Flon areas, respectively,
of northern Manitoba:
|
Grade
|
Contained
Metal
|
Deposit
|
Tonnes
|
Cu
(%)
|
Au
(g/t)
|
Ag
(g/t)
|
Zn
(%)
|
Cu
(lbs)
|
Au
(oz)
|
Ag
(oz)
|
Zn
(lbs)
|
Indicated
Category
|
Hudvam
|
854,076
|
1.22
|
3.82
|
13.84
|
1.78
|
23,008,000
|
105,000
|
380,000
|
33,541,000
|
WIM
|
2,776,787
|
1.94
|
1.88
|
7.53
|
0.30
|
118,763,000
|
168,000
|
672,000
|
18,365,000
|
Inferred
category
|
Hudvam
|
502,901
|
0.79
|
3.25
|
6.96
|
1.33
|
8,759,000
|
53,000
|
113,000
|
14,746,000
|
WIM
|
445,999
|
1.12
|
2.11
|
5.06
|
0.43
|
11,013,000
|
30,000
|
73,000
|
4,228,000
|
Notes to
Table:
|
1)
|
Resources Calculated
by Golder Associates Ltd., in 2008
|
2)
|
Cut-off grade of 2%
Copper Equivalent based on US$1.75/lb Cu, US$0.80/lb Zn, US$700/oz
Au, and US$10/oz Ag.
|
3)
|
Andre C. Tessier,
President and CEO of Murgor, PGeo, is the Qualified Person of the
foregoing technical information relating to the Murgor projects
presented in this press release, and has approved of this technical
information herein.
|
Unanimous Murgor Board Approval
The Arrangement has
been unanimously approved by the Board of Directors of Murgor. In
doing so, the Board of Directors has determined that the
Arrangement is fair to Murgor shareholders and is in the best
interests of Murgor and its shareholders. As a result, the Murgor
Board of Directors has authorized the submission of the Arrangement
to Murgor securityholders for approval at a special meeting of
securityholders and recommends that Murgor securityholders vote in
favour of the Arrangement. In reviewing the proposed transaction,
the Board of Directors received an opinion from RWE Growth
Partners, Inc. to the effect that the consideration to be received
by Murgor shareholders under the Arrangement is fair from a
financial point of view to them.
Murgor Shareholder Support
All directors and officers
of Murgor, as well as certain significant Murgor shareholders,
collectively holding approximately 10.1% of the outstanding Murgor
Shares, have agreed pursuant to support and voting agreements to
support and vote in favour of the Arrangement. The support and
voting agreements will terminate only upon termination of the
Arrangement Agreement.
Transaction Terms
Under the Arrangement, Murgor
shareholders will receive 0.5 of an Alexandria common share for each Murgor Share
held. There are currently 123,425,590 Murgor Shares and 5,546,005
Murgor stock options issued and outstanding. The share exchange
ratio represents a premium for the Murgor Shares of approximately
50% over their closing price on the TSX Venture Exchange on
December 22, 2014 and a premium of 52.48% over the
volume-weighted average price of the Murgor Shares on the TSX
Venture Exchange for the past 10 trading days. The total aggregate
consideration for Murgor under the Arrangement is approximately
$2.77 million. The Arrangement
Agreement provides that all outstanding Murgor stock options will
be converted into Alexandria stock
options (the "Replacement Options") on the same ratio
as the Murgor Shares. The Replacement Options will have an exercise
price of $0.12 and will expire twelve
months following the effective date of the Arrangement.
The Arrangement will be carried out by way of a court-approved
statutory plan of arrangement under the Canada Business
Corporations Act, subject to approval by Murgor securityholders
at a special meeting which is expected to be held in late
February 2015. The plan of
arrangement will be subject to the approval of at least 66 2/3% of
the votes cast by the holders of Murgor Shares and stock options,
voting as a single class. If approved by Murgor securityholders,
the plan of arrangement will be subject to final approval by the
Superior Court of Québec. Alexandria and Murgor expect to complete the
Arrangement in early March 2015.
The Arrangement is subject to certain other customary conditions
set out in the Arrangement Agreement, including the approval of the
TSX Venture Exchange and Murgor's compliance with covenants
relating to its operations until closing. The Arrangement Agreement
contains customary provisions prohibiting Murgor from soliciting
any other acquisition proposals and providing Alexandria with a right to match any
unsolicited acquisition proposal from a third party that the Board
of Directors of Murgor determines, in the exercise of its fiduciary
duties, to be superior to the Arrangement. In the event that
Alexandria does not match such a
superior proposal, the Board of Directors of Murgor will be
entitled to change its recommendation and terminate the Arrangement
Agreement.
The Arrangement Agreement provides that Murgor must pay
Alexandria a termination fee of
$300,000 in certain circumstances.
The Arrangement Agreement also provides that Alexandria must pay Murgor a reverse
termination fee of $300,000 in
certain circumstances.
Following completion of the Arrangement and based on the current
number of shares outstanding for each company, it is expected that
current Murgor shareholders will own approximately 20% of the
outstanding Alexandria shares, not
including shares, if any, issued by Alexandria after completion of the Arrangement
upon exercise of Replacement Options.
Murgor will mail a management information circular to the
securityholders of Murgor in advance of the special meeting. The
circular will include a copy of the fairness opinion of RWE Growth
Partners, Inc., a description of the various factors considered by
the Board of Directors of Murgor in its decision to approve the
Arrangement, as well as other relevant background information and
information on Alexandria. The
management information circular, Arrangement Agreement, plan of
arrangement, support and voting agreements and certain related
documents will be filed and available on SEDAR at www.sedar.com as
part of Murgor's and Alexandria's
public filings.
Miller Thomson LLP is acting as legal counsel to
Alexandria and Fasken Martineau
DuMoulin LLP is acting as legal counsel to Murgor in
connection with the Arrangement.
Forward-Looking Statements
This press release contains
forward-looking statements relating to the Arrangement. Statements
based on the current expectations of Murgor's and Alexandria's management contain known and
unknown inherent risks and uncertainties and no assurance can be
given that potential future results or circumstances will be
achieved or will occur. In particular, the timing and completion of
the proposed Arrangement are subject to certain conditions,
termination rights and other risks and uncertainties. Accordingly,
there can be no assurance that the proposed Arrangement will occur,
or that it will occur on the timetable or on the terms and
conditions contemplated. The reader should not place undue faith on
forward-looking information. Management disclaims any intention or
obligation to update or revise any forward-looking statements
whether as a result of new information, future events or
circumstances.
About Alexandria Minerals Corporation
Alexandria
Minerals Corporation is a Toronto-based junior gold exploration and
development company with one of the largest portfolios of
properties along the prolific, gold-producing Cadillac Break in
Val d'Or, Québec. Global gold
resources are distributed among three projects on its Cadillac
Break Property package, Akasaba, Sleepy, and Orenada, the details
of which can be found on the Company's website at www.azx.ca.
Agnico-Eagle Mines Ltd., with three producing gold mines in the
region, owns approximately 9% of the Company. Further information
about Alexandria is available on
Alexandria's website or our social
media sites listed below:
Facebook:
https://www.facebook.com/pages/Alexandria-Minerals-Corporation-AZXTSXV/186115074772628
Twitter: https://twitter.com/azxmineralscorp
YouTube: http://www.youtube.com/AlexandriaMinerals
Flickr: http://www.flickr.com/alexandriaminerals/
About Murgor Resources
Murgor Resources Inc. is a
mineral exploration and development company focused on gold and
copper exploration in Canada. The
Company owns a 100% interest in two gold-copper deposits in the
Snow Lake and Flin Flon mining districts of Manitoba. The Company further owns a portfolio
of high-potential gold properties in proven mining districts of
Canada, such as the Gullrock
property and its newly-acquired Wydee Property in Ontario.
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.
SOURCE Murgor Resources Inc.