Magna Mining Closes Acquisition of Lonmin Canada Inc.
Magna Mining Closes Acquisition of Lonmin
Canada Inc.
Sudbury, Ontario--(Newsfile Corp. - November 7, 2022) - Magna Mining Inc. (TSXV: NICU) ("
Magna
" or
the "
Corporation
") is pleased to announce that it has closed the acquisition of Lonmin Canada Inc.
("
Loncan
"), including the Denison Project and the past producing Crean Hill Ni-Cu-PGE mine (the
"
Acquisition
"), pursuant to a share purchase agreement dated August 15, 2022 (the "
Share Purchase
Agreement
") among the Corporation, Loncan, each of the shareholders of Loncan and Sibanye UK
Limited, as shareholder representative.
Under the terms of the Share Purchase Agreement, Magna acquired 100% of the issued and
outstanding shares of Loncan, whose core asset is the Denison Project, in exchange for an aggregate
purchase price of $16 million comprised of a closing payment of $13 million in cash (the "
First
Payment
") and a deferred payment of $3 million (the "
Deferred Payment
") payable pro rata to each
shareholder of Loncan (the "
Vendors
"). The Deferred Payment is payable on or before the 12-month
anniversary of the closing of the Acquisition. The Corporation will use commercially reasonable efforts to
settle the Deferred Payment in cash, but may, at its option, settle the Deferred Payment in common
shares of the Corporation priced at the time of issue in accordance with the rules of the TSX Venture
Exchange (the "
TSXV
"). As ongoing security pending the settlement of the Deferred Payment, the
Corporation has granted a pledge of the shares of Loncan in favour of the Vendors. The Corporation
inherited Loncan's existing commercial arrangements with Vale Canada Limited, including access rights
and certain net smelter return royalties. Certain other arrangements, including Loncan's joint venture
arrangements with Wallbridge Mining Company Limited, terminated concurrently with the completion of
the Acquisition.
In connection with the closing of the Acquisition, an advisory fee is payable to Desjardins Capital
Markets in the form of a cash payment of $100,000 plus 314,564 common shares of the Corporation
(the "
Advisory Fee Shares
"), valued at approximately $100,000 at a deemed price of $0.3179 per
Advisory Fee Share. The Advisory Fee Shares are subject to a four month and one day statutory hold
period in accordance with applicable Canadian securities laws.
Further details regarding the terms of the Acquisition and the Denison Project are set out in (i) the
Corporation's news release dated August 16, 2022, and (ii) the Share Purchase Agreement, both of
which are available on SEDAR (
www.sedar.com
) under the Corporation's issuer profile.
In addition, with the satisfaction of all conditions to the Acquisition, the Corporation satisfied the escrow
release conditions relating to the 74,128,860 subscription receipts of the Corporation (the
"
Subscription Receipts
") issued on a non-brokered private placement basis at a price of $0.27 per
Subscription Receipts for gross proceeds of approximately $20 million (the "
Offering
"). The gross
proceeds of the subscription including the earned interest thereon (the "
Escrowed Funds
") were
released to the Corporation and used, in part, to fund the First Payment of $13 million payable to the
Vendors in connection with the Acquisition. Each Subscription Receipt has been automatically
converted into one common share of the Corporation and one-half of one common share purchase
warrant (each whole common share purchase warrant, a "
Warrant
"), with each Warrant entitling the
holder thereof to purchase one common share at a price of $0.405 until November 4, 2025. The
Corporation intends to use the balance of the Escrowed Funds from the Offering for ongoing exploration
and development activities at the Denison Project.
About Magna Mining Inc.
Magna Mining is an exploration and development Corporation focused on nickel, copper and PGM
projects in the Sudbury Region of Ontario, Canada. The Corporation's flagship asset is the past
producing Shakespeare Mine which has major permits for the construction of a 4500 tonne per day open
pit mine, processing plant and tailings storage facility and is surrounded by a contiguous 180km
2
prospective land package. Additional information about the Corporation is available on SEDAR
(
www.sedar.com
) under the Corporation's issuer profile and on the Corporation's website
(
www.magnamining.com
).
For further information on this news release, visit
www.magnamining.com
or contact:
Jason Jessup
Chief Executive Officer
or
Paul Fowler, CFA
Senior Vice President
Email:
Cautionary Note Regarding Forward-Looking Information
This news release includes certain "forward-looking statements" which are not comprised of historical
facts. Forward-looking statements include estimates and statements that describe the Corporation's
future plans, objectives or goals, including words to the effect that the Corporation or management
expects a stated condition or result to occur. Forward-looking statements may be identified by such
terms as "believes", "anticipates", "expects", "estimates", "may", "could", "would", "will", or "plan". Since
forward-looking statements are based on assumptions and address future events and conditions, by
their very nature they involve inherent risks and uncertainties. Although these statements are based on
information currently available to the Corporation, the Corporation provides no assurance that actual
results will meet management's expectations. Risks, uncertainties and other factors involved with
forward-looking information could cause actual events, results, performance, prospects and
opportunities to differ materially from those expressed or implied by such forward-looking information.
Forward looking information in this news release includes, but is not limited to, the timing and receipt the
final acceptance of the TSXV of the Acquisition, the ability of the Corporation to complete the Deferred
Payment, the Corporation's current expectations, anticipated synergies and benefits of the Acquisition,
the use of the net proceeds from the Offering, the Corporation's objectives, goals or future plans,
statements, exploration results, potential mineralization, the estimation of mineral resources, exploration
and mine development plans, timing of the commencement of operations and estimates of market
conditions. Factors that could cause actual results to differ materially from such forward-looking
information include, but are not limited to, the inability to receive final acceptance of the TSXV, failure to
identify mineral resources, failure to convert estimated mineral resources to reserves, the inability to
complete a NI 43-101 technical report on the Denison Project, delays in obtaining or failures to obtain
any governmental, environmental or other project approvals, political risks, uncertainties relating to the
availability and costs of financing needed in the future, changes in equity markets, inflation, fluctuations in
commodity prices, delays in the development of projects, capital and operating costs varying
significantly from estimates and the other risks involved in the mineral exploration and development
industry, and those risks set out in the Corporation's public documents filed on SEDAR. Although the
Corporation believes that the assumptions and factors used in preparing the forward-looking information
in this news release are reasonable, undue reliance should not be placed on such information, which only
applies as of the date of this news release, and no assurance can be given that such events will occur in
the disclosed time frames or at all. The Corporation disclaims any intention or obligation to update or
revise any forward-looking information, whether as a result of new information, future events or otherwise,
other than as required by law.
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.
To view the source version of this press release, please visit
https://www.newsfilecorp.com/release/143301