Lions Bay Capital Inc. (TSXV:LBI) is pleased to advise that Parkway Minerals NL (“Parkway Minerals”), an Australian Stock Exchange (ASX) listed fertiliser minerals company, has signed binding term sheets to acquire 97.79% of the outstanding shares in Consolidated Potash Corporation (CPC) including 100% of the shares held by Lions Bay.
Lions Bay Capital Inc. (TSXV:LBI) (“Lions Bay” or the “Company”) is pleased to advise that Parkway Minerals NL (“Parkway Minerals”), an Australian Stock Exchange (ASX) listed fertiliser minerals company, has signed binding term sheets to acquire 97.79% of the outstanding shares in Consolidated Potash Corporation (CPC), (the “Transaction”), including 100% of the shares held by Lions Bay.
Lions Bay is currently the largest shareholder of CPC (owns 48% of the issued capital) and has also provided working capital by way of loan funds of approximately C$550,000 to CPC. Following the satisfaction of all the conditions precedent (including Parkway Minerals shareholder approval) outlined in the term sheet, at completion of the Transaction, Lions Bay will receive approximately:
- 223 million ordinary shares in Parkway Minerals
- 54.5 million partly paid shares in Parkway Minerals
- 10 million shares in Davenport Resources Ltd (details below)
Based on the recently traded share prices for both Parkway Minerals and Davenport Resources, the approximate market value of the shareholdings to be received by Lions Bay is in the order of $1.6 million. At completion of the Transaction, executive director of Lions Bay and managing director of CPC, Mr Bahay Ozcakmak will join the board of Parkway Minerals as an executive director. Lions Bay has also nominated Mr Patrick Power, the founder and current director of Western Potash Corp. (TSXV:WRX) (the developer of the innovative Milestone Potash Project in Saskatchewan), to also join the board of Parkway Minerals as a non-executive director.
Executive Director of Lions Bay and Managing Director of CPC, Mr Bahay Ozcakmak commented:
“Following a prolonged period of under-investment in the fertiliser minerals sector, we believe we are approaching a period where robust projects with a line of sight to sustainable development, will be highly sought after by industry and strategic investors. Following our announcement in February this year that CPC had completed a Scoping Study on the Karinga Lakes Potash Project, we have received significant interest in both CPC and its promising aMES™ technology. In June this year, our joint venture partner at the Karinga Lakes Potash Project, Verdant Minerals was acquired by a UK based private equity firm at more than twice the prevailing market price before the acquisition was announced, highlighting the deep-value in the sector, that is gradually being recognised by astute investors. As evidenced by our own transaction announced with Parkway Minerals today, we expect the consolidation and rationalisation trend in the sector to continue. In this regard, we believe the transaction between CPC and Parkway Minerals is not only well-timed, but highly synergistic as it combines complementary projects, technology and skills, and positions the merged-entity strongly as an emerging player in the fertiliser minerals sector.”
Executive Chairman of Lions Bay, Mr John Byrne commented:
“This transaction is an important step in Lions Bay’s journey to unlock value from one of its early seed investments, by providing visibility on what we have always believed to be significant embedded value within CPC. We have supported the development of CPC and its proprietary mineral processing technology over the past two years and believe this transaction with Parkway creates a company with the critical-mass required to be able to grow the core business and execute an ambitious business plan.
“As the major vendor of CPC into the transaction, we have agreed to assist Parkway Minerals conduct a relatively modest capital raise to support the transaction. As soon to be major shareholders of both Parkway and Davenport, we look forward to supporting both the respective management teams to assist in the alignment and transformation of both companies, to ensure they are on a robust growth trajectory moving forward. Whilst the merits of the effective merger of CPC with Parkway are outlined in the Parkway announcement and the accompanying presentation, we are equally excited about the opportunity of assisting Davenport receive the recognition it deserves. Although Davenport has flown under the radar in recent times, we have been impressed with how quickly the Davenport team have been able to systematically assemble a portfolio of projects in Central Germany, which now represent the largest potash resource in Western Europe. We are pleased to be able to expose our shareholders to such opportunities. This is a great example of how Lions Bay is focused on strategically leveraging the experience and network of the management team in the relatively high-risk resources sector, to create value for our shareholders. This transaction highlights how an investment in Lions Bay provides an opportunity for investors to gain exposure to the formation and development of resources focused companies and benefit from the experience of the Lions Bay management team.”
Should the Transaction proceed as envisaged, Lions Bay will have strategic shareholdings in five listed public companies:
- Fidelity Minerals) – focused on copper gold projects in Peru;
- Elementos – an emerging global tin company;
- Kalina Power – developing portfolio of waste heat power plants;
- Parkway Minerals – Australian fertiliser minerals company.
- Davenport Resources – owner of significant German potash projects.
The Transaction is subject to Parkway Minerals shareholder approval and a number of conditions precedent. Additional details about the acquisition of CPC by Parkway Minerals, can be found in the announcement released to the Australian Securities Exchange (ASX) by Parkway Minerals, as attached.
About Lions Bay Capital Inc.
Lions Bay Capital Inc. is a TSX-V listed Investment Issuer that is focused on high return investment opportunities, principally in the mining, clean energy and clean technology sectors, where it provides public and private companies with strategic and financial support.
On behalf of the Board of Lions Bay.
Tel: +61 3 9236 2800
Tel: +61 3 9236 2800
For more information, please visit the corporate website at www.lionsbaycapital.com or contact the above.
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Cautionary Statement Regarding Forward-Looking Information
This press release contains “forward-looking statements” or “forward-looking information” (collectively referred to herein as “forward-looking statements”) within the meaning of applicable securities legislation. Such forward-looking statements include, without limitation, forecasts, estimates, expectations and objectives for future operations that are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the Company. Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by the words “will”, “plan”, “intends”, “may”, “will”, “could”, “expects”, “anticipates” and similar expressions. Further disclosure of the risks and uncertainties facing Lions Bay and other forward-looking statements are discussed in Lions Bay’s Management’s Discussion and Analysis which is available under the Company’s profile on www.sedar.com.
Forward-looking statements are based on assumptions made by and information currently available to the Company. Although management considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect. By their very nature, forward-looking statements involve inherent risks and uncertainties and readers are cautioned not to place undue reliance on these statements as a number of factors could cause actual results to differ materially from the beliefs, plans, objectives, expectations, estimates and intentions expressed in such forward-looking statements. These factors include, for the Company and the companies it is invested in, but are not limited to, commodity prices, fluctuations in revenues and expenses, need for additional funding, availability of such additional funding and that funding will be on acceptable terms, retention of key employees, economic conditions, currency fluctuations, competition and regulations, legal proceedings and risks related to operations in foreign countries.
The forward-looking statements in this press release are made as of the date they are given and, except as required by applicable securities laws, the Company disclaims any intention or obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.