Canada Cobalt Signs Binding LOI to Acquire Strategic Assets
Canada Cobalt Signs Binding LOI to Acquire
Strategic Assets
COQUITLAM, BC
,
Oct. 10, 2019
/CNW/ - Canada Cobalt Works Inc. (TSXV: CCW) (OTC:
CCWOF) (
Frankfurt
: 4T9B) (the "Company" or "Canada Cobalt") is pleased to announce that the
Company has signed a binding Letter of Intent (the "Transaction") to acquire the assets of PolyMet
Resources Inc. ("PolyMet"), owner of PolyMet Labs (ISO certified) and the Northern Ontario Silver-
Cobalt Camp's only permitted and operating mineral and precious metal processing facility.
The Transaction, consummated at a strategic time in the precious metals cycle, provides Canada
Cobalt with multiple immediate and long-term advantages including a high capacity bullion melting
furnace to pour payable silver and gold dore bars. The 23,400 sq. foot facility with district leading
sampling and analytical capabilities can also host the Company's proprietary Re-2OX Process for
environmentally friendly extraction of cobalt, precious and base metals.
Highlights
:
The lab and mineral processing facility will become the new headquarters of Canada Cobalt and
is located in the town of
Cobalt
, immediately adjacent to a rail line and just a short distance from
the Company's Castle mine and Beaver Property;
This well-established sampling and analytical facility, specializing in high-grade mineralization,
provides commercial assaying, crushing, screening, grinding, bulk sampling, upgrading and
smelting services all in one location, driving multiple revenue streams at a time when gold prices
in Canadian dollars have hit new record highs. PolyMet has demonstrated that in an 8-hour shift
it can pour up to 10 dore silver bars of 1,000 ounces each (90% to 95% fine);
PolyMet is currently making inroads into the potentially lucrative e-waste business that can be
leveraged through Canada Cobalt, its extensive relationships and its Re-2OX Process. Material
from mixed computer boards is being processed through the facility's shredder and ball mill to
recover precious and base metals.
Mr.
Frank Basa
, President and CEO of Canada Cobalt, stated: "This deal builds dramatically on
Canada Cobalt's current competitive advantages and opportunities - technological, on the ground
and underground - in a rejuvenated silver-cobalt district recognized as the birthplace of Canadian
hard rock mining. With such a unique and fully operational facility in the town of
Cobalt
, so close to
the Castle mine and other properties, Canada Cobalt achieves a key goal of becoming a vertically
integrated leader in
Canada's
silver-cobalt heartland while it also exploits a powerful new cycle in
precious metals."
Mr.
Gino Chitaroni
, majority owner of PolyMet Resources Inc., commented: "We see some really
exciting synergies here. Canada
Cobalt's
track record of success in this district made them the
perfect fit to take the PolyMet Lab and facility to the next level while I remain involved to assist
Canada Cobalt from an operational standpoint.
"We appear to have entered a dynamic new cycle for silver and gold, which could really help to
ignite this business in terms of its traditional drivers, while we're seeing exciting new opportunities in
the e-waste sector that can be more fully exploited through this Transaction," Chitaroni continued.
"Bullion pouring, bulk sampling, commercial assaying and e-waste are PolyMet's four key immediate
profit centers that merge with Canada Cobalt, creating powerful new synergies. Hosting Re-2OX
and accelerating the development of such a unique and environmentally friendly process at this
facility is a major coup for the town of
Cobalt
and the broader district."
Terms of the Transaction
Canada
Cobalt
and PolyMet have executed a binding Letter of Intent whereby PolyMet has agreed
to sell 100% of its assets, including but not limited to the property, the plant and the equipment, all
located at 1 Presley Street in
Cobalt, Ontario
, for total consideration of
$650,000
(cash and shares
of Canada Cobalt). Also included in the assets are all of the issued and outstanding shares of
PolyMet.
The cash portion of the Transaction is
$333,000
while Canada Cobalt will issue to PolyMet 932,353
shares at
34 cents
per share for the remaining
$317,000
, payable upon completion of a due
diligence review period not to exceed 90 days. During this due diligence review, PolyMet will make
available to Canada Cobalt all environmental and title documents, maps, logs, books, papers,
technical data and other pertinent documents related to the assets.
Current PolyMet personnel, including Mr. Chitaroni, will be retained on contracts with share-based
incentive clauses related to certain business milestones over the next 12 months. Facility upgrades
combined with an aggressive sales strategy are expected to help achieve a significant ramp-up in
growth and profitability. These initiatives will be funded by revenues and an approximate
$250,000
investment by Canada Cobalt over the next six months.
The Canada Cobalt-PolyMet Transaction is subject to TSX Venture Exchange approval.
Qualified Person
The technical information in this news release was prepared under the supervision of
Frank J. Basa
,
P.Eng., Canada Cobalt's President and Chief Executive Officer, who is a member of Professional
Engineers Ontario and a qualified person in accordance with National Instrument 43-101.
About Canada Cobalt Works Inc.
Canada
Cobalt
has 100% ownership of the Castle mine and the 78 sq. km Castle Property with
strong exploration upside in the prolific past producing
Gowganda
high-grade Silver Camp of
Northern Ontario
. With underground access at Castle, a pilot plant to produce cobalt-rich gravity
concentrates on site, and a proprietary hydrometallurgical process known as Re-2OX for the
creation of technical grade cobalt sulphate as well as nickel-manganese-cobalt (NMC) formulations,
Canada Cobalt is strategically positioned to become a vertically integrated North American leader in
cobalt extraction and recovery while it also exploits a powerful new silver-gold market cycle.
"Frank J. Basa"
Frank J. Basa
, P. Eng.
President and Chief Executive Officer
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this
release. This news release may contain forward-looking statements including but not limited to
comments regarding the timing and content of upcoming work programs, geological interpretations,
receipt of property titles, potential mineral recovery processes, etc. Forward-looking statements
address future events and conditions and therefore, involve inherent risks and uncertainties. Actual
results may differ materially from those currently anticipated in such statements.
SOURCE
Canada Cobalt Works Inc.
View original content:
http://www.newswire.ca/en/releases/archive/October2019/10/c2944.html
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For further information:
Frank J. Basa, P.Eng., President and CEO, 1-416-625-2342; Marc
Bamber, Director, [email protected], +44-7725-960939
CO: Canada Cobalt Works Inc.
CNW 17:15e 10-OCT-19