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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Maverix Metals Inc | TSXV:MMX | TSX Venture | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 5.76 | 5.71 | 5.79 | 0 | 01:00:00 |
TORONTO, April 18, 2016 /CNW/ - Pan American Silver Corp. ("Pan American") and MacMillan Minerals Inc. (TSX-V:MMX) ("MacMillan") are pleased to announce that they have entered into an arrangement agreement dated April 18, 2016 (the "Arrangement") with Maverix Metals Inc. ("Maverix"), which when completed, will launch Maverix as a new publicly traded royalty and streaming company.
Under the terms of the Arrangement, MacMillan will acquire all of the issued and outstanding securities of Maverix (the "Reverse Takeover", or "RTO"). Concurrently MacMillan will purchase a package of thirteen royalties and precious metal streams from Pan American (collectively, the "Portfolio", as described below).
On the closing of the Arrangement, MacMillan will be renamed Maverix Metals Inc. and will continue to trade as MMX on the TSX Venture Exchange. Mr. Geoff Burns, the former CEO of Pan American, will be appointed as the Chairman of the combined company and Mr. Daniel O'Flaherty will be appointed as Maverix's Chief Executive Officer.
Transaction Highlights
Mr. Michael Steinmann, President and CEO of Pan American said, "This transaction represents an attractive opportunity for Pan American to unlock value for a group of its assets that have gone largely unrecognized by the market as a number of them are not in production and are widely dispersed in our company. As the majority shareholder, Pan American will maintain meaningful upside exposure and leverage to these assets, and to Maverix's ability to grow the portfolio, led by a trusted and experienced management team."
Mr. Geoff Burns, Chairman of Maverix commented, "I am truly excited about the future prospects for Maverix. The portfolio of royalties and metal streams that has been assembled provides a solid, cash generating foundation to build upon. I look forward to working closely with a newly configured and knowledgeable board, a lean, aggressive and innovative management group and with the support of Pan American, to prudently grow our portfolio and create value for all of Maverix's shareholders." Burns continued, "The timing is right, the vehicle is right and I firmly believe that bringing a financially disciplined approach to growth in this sector will handsomely reward Pan American for its confidence in supporting the creation of Maverix."
Mr. Thomas Skimming, Chief Executive Officer of MacMillan stated, "The Board of Directors and the senior management of MacMillan are unanimously in favour of the Arrangement and are recommending that all shareholders vote to approve the transaction. We are extremely pleased to be able to offer this significant transaction to our shareholders. The addition of the new directors and management to MacMillan, the acquisition of the royalties and streams, and the influx of capital, ensures the long term viability of MacMillan, and provides a tremendous opportunity for our shareholders to realize value."
The Portfolio
Pursuant to the terms of the Arrangement, Maverix will have acquired from Pan American thirteen royalties and precious metal streams:
Key Assets:
Other Assets in the Portfolio
Valuation of the Portfolio
Roscoe Postle Associates Inc. of Toronto ("RPA") was contracted by MacMillan to review the valuation of the Portfolio prepared by Maverix. RPA has provided its report to the Board of Directors of MacMillan. As a review of valuation of the Portfolio, RPA carried out preliminary valuations of each of the assets in the portfolio individually, using either after-tax discounted cash flow analysis or comparable transaction analysis and, subject to the assumptions, limitations and qualifications as set out in the report, estimated that the value of the Portfolio is in the range of CAD$52 million to CAD$57 million at consensus long term metal prices. Details from the RPA report will be disclosed in the MacMillan management information circular which is expected to be filed and mailed to MacMillan shareholders within the next several weeks.
Maverix's Board of Directors, Special Advisor and Senior Executive Team
In addition to Mr. Burns and Mr. O'Flaherty, Maverix will welcome Mr. J.C. Stefan Spicer, Dr. Christopher Barnes, and Pan American representatives Mr. Rob Doyle and Mr. Christopher Emerson to its Board of Directors. In addition, Mr. George A. Brown currently President and a Director of MacMillan will remain as a Director of the combined company and Mr. David Scott has agreed to act as a Special Advisor to the Board.
Mr. Geoff Burns previously served as President and CEO of Pan American from May 2004 until his retirement on December 31st of 2015. During his tenure, Pan American increased its silver production from 7.5 million ounces to over 26 million ounces annually, to become the second largest primary silver producer in the world. Mr. Burns holds a BSc degree in Geology and a M.B.A.
Mr. Daniel O'Flaherty has over ten years of investment banking and Executive Officer experience. Mr. O'Flaherty is currently an Executive and Director of Anthem United, and prior to that an Executive Vice President of Corporate Development of Esperanza Resources. Mr. O'Flaherty was a director in the investment banking team of Scotia Capital in Vancouver focused exclusively on the metals and mining sector and holds a BComm degree from UBC.
Mr. J.C. Stefan Spicer has over 30 years of investment industry experience and is the Chairman, President and CEO of Central Fund of Canada Limited, which trades on the NYSE (CEF) and TSX (CEF.A) and passively holds in excess of US$3.3 billion in unencumbered, allocated and physically segregated holdings of gold and silver bullion held in Canada.
Dr. Christopher Barnes is a medical professional and experienced businessman who after 22 years of service, recently stepped down as Chief of Medicine for the Blind River Hospital in Ontario.
Mr. Rob Doyle is the Chief Financial Officer of Pan American, a role which he has held for the past 12 years. Mr. Doyle holds professional designations as a CA and a CFA with a BBSc (Honours) Finance degree from the University of Cape Town.
Mr. Christopher Emerson is Vice President of Business Development and Geology for Pan American. He holds a BEng in Industrial Geology from the Camborne School of Mines and an MSc in Mineral Exploration from Leicester University.
Mr. George A. Brown is currently the President and a Director of MacMillan. Mr. Brown holds a BBA degree from Bishop's University. He has over 34 years of experience with mining, exploration, and mining supply companies, the past 8 years as an officer, director or consultant with MacMillan.
Mr. David Scott is Vice Chairman and Managing Director, CIBC Capital Markets. Mr. Scott has been involved in the majority of significant mining mergers and acquisitions and equity financing transactions completed in Canada during the last 30 years and has extensive contacts in the mining and banking industries globally. Mr. Scott will act as Special Advisor to Maverix's Board of Directors.
The Arrangement Agreement
The Arrangement Agreement sets out the terms of the RTO and the Arrangement involving MacMillan, Maverix, the shareholders of MacMillan and Maverix, and Pan American, including, among other things:
It is anticipated that at the MacMillan Special Meeting (described below), MacMillan will also seek approval from its shareholders to adopt or approve: new corporate by-laws; a change in its year end to December 31st; and a new stock option plan and equity based compensation plan (collectively, the "Additional Matters").
It is also anticipated that the combined company will change its name to "Maverix Metals Inc." upon completion of the RTO and continue to trade on the TSX Venture Exchange under the symbol "MMX".
The terms and conditions of the Arrangement Agreement will be disclosed in detail in the MacMillan management information circular which is expected to be filed and mailed to MacMillan shareholders within the next several weeks.
Scotiabank acted as financial advisor to Pan American.
MacMillan Share Consolidation
MacMillan currently has 6,873,330 common shares outstanding and stock options exercisable to acquire up to 415,000 common shares. Assuming no exercise of the stock options, it is anticipated that on a post-Consolidation basis, MacMillan will have issued and outstanding 3,436,665 common shares and stock options exercisable to acquire 207,500 common shares for an aggregate of 3,644,165 common shares on a fully-diluted and post-Consolidation basis.
Post Arrangement Capital Structure
Pursuant to the Arrangement MacMillan will issue approximately 43 million post-Consolidation common shares and approximately 33.1 million post-Consolidation common shares to Pan American and Maverix, respectively.
Post the completion of the Arrangement and the renaming of MacMillan to Maverix, Pan American will hold approximately 54% of the issued and outstanding common shares of Maverix. Maverix's current shareholders and Subscription Receipt holders will hold approximately 41% of the issued and outstanding common shares and MacMillan's current shareholders will hold the remaining 5% of Maverix. It is expected that Maverix will have a total of approximately 79.7 million shares issued and outstanding following the Arrangement.
In addition, Pan American will receive 20,000,000 common share purchase warrants of MacMillan post-Consolidation (the "PAS Warrants"). The PAS Warrants are exercisable for five years after closing of the Arrangement. One-half of the PAS Warrants are exercisable for CAD$0.70 per share and one-half are exercisable for CAD$1.00 per share.
Majority Shareholder Agreement
Pan American will enter into a shareholder agreement (the "Shareholder Agreement") with Maverix, pursuant to which Pan American and Maverix will agree that, among other things:
MacMillan Special Shareholder Meeting
MacMillan will be calling an annual general and special meeting of its shareholders (the "MacMillan Meeting") to seek approval of the share Consolidation, the Arrangement, the RTO, the increase in the number of directors as well as to nominate for election the proposed new directors as set out above. In addition, MacMillan will seek the approval of its shareholders for the Additional Matters. MacMillan will issue a press release at the time that it provides notice to its shareholders of the MacMillan Meeting and the dissemination of MacMillan's management information circular in respect of the MacMillan Meeting. Completion of the Arrangement is subject to a favourable vote of at least two-thirds (66 2/3%) of the MacMillan common shares voted at the MacMillan Meeting.
Board Approval and Voting Support
The Directors of MacMillan have unanimously approved the transaction and unanimously recommend that MacMillan shareholders vote in favour of the Arrangement. The Directors and Officers of MacMillan have entered into voting support agreements whereby the Directors and Officers have agreed to vote their shares in favour of the Arrangement at the MacMillan Meeting.
Related Party Disclosure
Certain insiders of Pan American, participated in private placement financings of Maverix, each constituting a related party transaction pursuant to Multilateral Instrument 61-101 -- Protection of Minority Security Holders in Special Transactions ("MI 61-101"). Pan American relied on section 5.5(a) of MI 61-101 for an exemption from the formal valuation requirement and section 5.7(1)(a) of MI 61-101 for an exemption from the minority shareholder approval requirement of MI 61-101 as the fair market value of the Portfolio and the Reverse Takeover did not exceed 25% of the Pan American's market capitalization.
Maverix Metals Inc.
Maverix, which is arm's length to MacMillan, is a private company incorporated under the laws of British Columbia and founded by Mr. Geoff Burns and Mr. Daniel O'Flaherty. Prior to signing the Arrangement Agreement, Maverix undertook three private financings to raise a total of CAD$5.9 million through the issuance of common shares and Subscription Receipts. The subscription receipts are exchangeable into common shares of MacMillan on a one for one basis, post MacMillan's proposed share consolidation and upon completion of the RTO transaction. Maverix was formed with the sole purpose of becoming a mining royalty and streaming company. Having attracted an experienced management team and Board of Directors, its primary activity to date has been the negotiation, financing and structuring for the acquisition of metal royalties and streams from Pan American, and the related RTO transaction with MacMillan.
Pan American Silver Corp.
Pan American's mission is to be the world's pre-eminent silver producer, with a reputation for excellence in discovery, engineering, innovation and sustainable development. Pan American has seven operating mines in Mexico, Peru, Argentina and Bolivia. Pan American also owns several development projects in Mexico, USA, Peru and Argentina.
MacMillan Minerals Inc.
MacMillan is an exploration company with a focus on gold and silver exploration on numerous properties in Mexico. Additional information on the Company can be viewed at www.sedar.com.
Completion of the transactions described above is subject to a number of conditions, including the acceptance of the TSX Venture Exchange and court and shareholder approval. The transaction cannot close until all requisite approvals are obtained. There can be no assurance that the transaction will be completed as proposed or at all.
Investors are cautioned that, except as disclosed in the management information circular to be prepared in connection with the transaction, any information released or received with respect to the RTO or the Arrangement may not be accurate or complete and should not be relied upon. Trading in the securities of MacMillan should be considered highly speculative.
The TSX Venture Exchange has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release.
NEITHER THE 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.
This news release does not constitute an offer to sell or a solicitation of an offer to buy any of MacMillan's securities in the United States. None of the securities have been and will not be registered under the United States Securities Act of 1933, as amended (the "1933 Act"), or any state securities laws and may not be offered or sold within the United States or to U.S. persons unless registered under the 1933 Act and applicable state securities laws, or an exemption from such registration is available. Any public offering of securities in the United States must be made by means of a prospectus that contains detailed information about MacMillan and its management, as well as financial statements.
Forward-Looking Statements
This release contains certain "forward looking statements" and certain "forward-looking information" as defined under applicable Canadian and U.S. securities laws. Forward-looking statements and information can generally be identified by the use of forward-looking terminology such as "may", "will", "expect", "intend", "estimate", "anticipate", "believe", "continue", "plans" or similar terminology. Forward-looking statements and information include, but are not limited to, statements with respect to the transactions contemplated under the Arrangement Agreement, the Arrangement and the RTO, the requisite regulatory, court and shareholder approvals in respect thereof and proposed future transactions MacMillan may undertake and their expected timing. Forward-looking statements and information are based on forecasts of future results, estimates of amounts not yet determinable and assumptions that, while believed by management to be reasonable, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Forward-looking statements and information are subject to various known and unknown risks and uncertainties, many of which are beyond the ability of MacMillan to control or predict, that may cause MacMillan's actual results, performance or achievements may be materially different from those expressed or implied thereby, and are developed based on assumptions about such risks, uncertainties and other factors set out here in, including but not limited to: the risk that the RTO will not be approved by the TSX Venture Exchange, the court and the shareholders of MacMillan, as applicable; risks and uncertainties related to the Arrangement not being completed in the event that the conditions precedent thereto are not satisfied; the inherent risks involved in the exploration and development of mineral properties; the uncertainties involved in interpreting exploration data; the potential for delays in exploration or development activities; the geology, grade and continuity of mineral deposits; the possibility that future exploration, development or mining results will not be consistent with MacMillan's expectations; accidents, equipment breakdowns, title matters, labor disputes or other unanticipated difficulties or interruptions in operations; fluctuating metal prices; unanticipated costs and expenses; uncertainties relating to the availability and costs of financing needed in the future; the inherent uncertainty of production and cost estimates and the potential for unexpected costs and expenses, commodity price fluctuations; currency fluctuations; regulatory restrictions, including environmental regulatory restrictions; liability, competition, loss of key employees and other related risks and uncertainties. MacMillan undertakes no obligation to update forward-looking information except as required by applicable law. Such forward-looking information represents management's best judgment based on information currently available. No forward-looking statement can be guaranteed and actual future results may vary materially. Accordingly, readers are advised not to place undue reliance on forward-looking statements or information.
SOURCE Pan American Silver Corp.
Copyright 2016 Canada NewsWire
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