Canadian mining firm NorZinc has accepted a takeover supply from non-public fairness group RCF VI (RCF) to make sure the long-term viability of its Prairie Creek challenge in Canada’s Northwest Territories.
NorZinc’s board of administrators unanimously made the choice because the agency seems to handle monetary challenges equivalent to unfavourable working capital and restricted money to fund the Prairie Creek challenge’s improvement.
RCF and its associates at the moment personal a stake of round 48.31% in NorZinc.
Beneath the court-approved plan of association, RCF has agreed to amass all of the excellent NorZinc shares that it doesn’t already personal for C$0.0325 ($0.0218) in money for every share.
This represents a premium of three.5% to the 45-day volume-weighted common worth of C$0.0314 to a share.
On the similar time, the 2 companies have amended and restated a credit score facility that gives for an $11m improve within the dedication.
NorZinc will use the proceeds from this to handle its near-term liquidity wants.
NorZinc president and CEO Rohan Hazelton mentioned: “The corporate has been working to handle challenges with respect to its debt state of affairs and the capital funding wants given the present market situations.
“The board has explored all viable strategic alternate options. In the end, it has concluded that the unsolicited all-cash supply to the minority shareholders contained throughout the association settlement is in the very best curiosity of the corporate and its stakeholders.”
NorZinc mentioned it has been in search of funding since early final yr to assist its long-term marketing strategy, however the efforts had been unsuccessful so far.
Positioned in conventional Dene territory, the Prairie Creek Venture contains a mine and its surrounding land and entry.
Primarily based on the outcomes of the a preliminary financial evaluation carried out final yr, the challenge could have a each day capability of two,400t and an operational lifetime of 20 years.
