Anaconda Opposes Maritime’s ‘Shareholder Diluting’ Unit Offering

Anaconda Mining Inc. (TSX:ANX) announced that it has notified the TSX Venture Exchange, British Columbia Securities Commission and board of directors of Maritime Resources Corp. (TSXV:MAE) of its dissatisfaction with Maritime’s proposed private placement of up to US$1,000,000, through the issuance of a combination of units at a price of US$0.10 per unit and flow-through units at a price of US$0.12 per flow-through unit.

As quoted in the press release:

The private placement is clearly an inappropriate defensive tactic proposed to be undertaken by Maritime in the face of Anaconda’s premium take-over bid to acquire all the issued and outstanding common shares of Maritime in exchange for consideration of 0.390 of a common share of Anaconda for each Maritime share.

This reckless act is a thinly veiled attempt to disrupt the premium offer, alter the offer’s dynamics and deprive shareholders of Maritime of a unique opportunity to realize an immediate premium while also preserving their upside participation in the creation of an emerging Canadian gold producer with a significant growth profile. The private placement is below-market (at less than US$0.10 per Maritime share) and far below the offer consideration. There is no immediate commercial justification for the private placement.

Completion of the highly dilutive private placement may compel Anaconda to consider withdrawing the Offer for a number of reasons, including but not limited to:

1.	The proposed private placement will have a substantial dilutive effect on the Maritime shareholders and, if completed in its entirety, will represent in excess of 17 percent of the current issued and outstanding Maritime shares (on a partially diluted basis).
2.	The proposed private placement is non-brokered, so that the Maritime shares can be placed only with investors who support the Maritime management and oppose the offer. Indeed, the directors’ circular filed by Maritime confirms that an affiliate of Maritime’s financial advisor (which has now opined that the consideration under the offer is inadequate) may participate in the proposed private placement.
3.	The Maritime board and management’s interests are not aligned with those of the Maritime shareholders as, collectively, they only own approximately 2.5 percent of the issued and outstanding Maritime shares.
4.	Anaconda believes that the Maritime board approved the private placement as a tactical maneuver intended to frustrate the Offer and further entrench management. The directors’ circular filed by Maritime does not indicate that there was any consideration of the fairness of the proposed private placement versus the offer. The timing and intent of the private placement further illustrates Maritime management’s motive of personal entrenchment and the associated complicity of the Maritime board, all at considerable expense to Maritime’s shareholder value.

Anaconda understands that shareholders of Maritime have written to the TSXV, BCSC, and Maritime board expressing their disapproval of the abusive tactics being employed by Maritime to frustrate the Offer. Anaconda encourages all Maritime shareholders to contact the TSXV, BCSC and Maritime board to express their frustration.

Click here to read the full Anaconda Mining Inc. (TSX:ANX) press release.