Dalradian Resources Inc. Recommended Cash Offer By Orion Mine Finance To Acquire Dalradian Resources Inc.

 
TIDMDALR 
 
 
   TORONTO, June 21, 2018 (GLOBE NEWSWIRE) -- Dalradian Resources Inc. 
(TSX:DNA) (AIM:DALR) ("Dalradian" or the "Company") and Orion Mine 
Finance are pleased to announce that the Company and certain affiliates 
of Orion Mine Finance (collectively, "Orion") have entered into a 
definitive arrangement agreement (the "Arrangement Agreement"), whereby 
Orion will acquire all of the issued and outstanding common shares of 
the Company ("Dalradian Shares") by way of a statutory plan of 
arrangement under the Business Corporations Act (Ontario) (the 
"Transaction"). Under the terms of the Arrangement Agreement, the 
Dalradian Shares held by certain members of the Dalradian senior 
management team, Sean Roosen and Osisko Gold Royalties Ltd (collectively, 
the "Remaining Shareholders") will not be acquired by Orion. 
Collectively, Orion and the Remaining Shareholders currently hold 
72,695,911 Dalradian Shares or 20.4% of the issued and outstanding 
Dalradian Shares. 
 
   The Arrangement Agreement 
 
   Under the terms of the Arrangement Agreement, each Dalradian shareholder 
(other than the Remaining Shareholders) (the "Affected Dalradian 
Shareholders") will receive cash consideration of C$1.47 for each 
Dalradian Share held (the "Consideration"), valuing Dalradian's total 
equity at approximately C$537 million, on a fully diluted in-the-money 
basis. The Consideration represents a 62% premium to the closing price 
of the Dalradian Shares on the Toronto Stock Exchange (the "TSX") on 
June 20, 2018 and a 49% premium to the volume weighted average price 
("VWAP") of the Dalradian Shares over the last 30 trading days. 
 
   Benefits to Dalradian Shareholders 
 
 
   -- Immediate and significant premium of approximately 62% to the closing 
      price of the Dalradian Shares on June 20, 2018, and approximately 49% 
      based on the 30-day VWAP. 
 
   -- All cash offer that is not subject to a financing condition. 
 
   -- Strong deal certainty with support agreements accounting for a total of 
      approximately 31.4% from directors and senior officers of Dalradian, 
      certain funds, Orion and the Remaining Shareholders. 
 
 
   Oskar Lewnowski, Chief Investment Officer of Orion, commented, "We are 
very pleased to expand our ownership in one of the world's best 
undeveloped gold deposits. Curraghinalt gets more exciting as additional 
exploration and engineering work is completed, the recent positive 
resource update being just the latest example. The Dalradian team has 
done an outstanding job of growing the deposit and advancing it through 
the feasibility stage. We look forward to working with the core 
Dalradian management team to secure planning permission for a world 
class mine using best-in-class mining, processing and environmental 
standards." 
 
   Patrick F.N. Anderson, CEO of Dalradian, stated, "Orion and Osisko are 
showing great confidence in Northern Ireland, our high grade 
Curraghinalt project and our West Tyrone workforce. Their goals as 
strategic investors are completely aligned with ours - to secure 
planning permission for an underground gold mine and continue advancing 
the project in a way that benefits all our stakeholders. We will 
continue to work closely with community members, all levels of 
government, employees, contractors and local suppliers toward building 
one of the world's top gold mines." 
 
   Jim Rutherford, Non-Executive Chairman of Dalradian, stated, "In the 
space of less than ten years, Dalradian has succeeded in transforming 
its flagship Curraghinalt project in Northern Ireland from a virtual 
grassroots discovery into one of the world's best and highest grade gold 
deposits, that will provide significant inward investment and economic 
benefits for the Northern Ireland economy. The premium cash offer from 
Orion that we have announced today therefore reflects the results of 
several years' diligent, professional work by the entire Dalradian team. 
My fellow board directors and I would like to express our thanks and 
appreciation to all who have been involved in successfully developing 
the project to this stage." 
 
   Major Shareholder Support 
 
   Certain funds and accounts under management by subsidiaries of BlackRock 
Inc., which hold approximately 37,945,699 Dalradian Shares, representing 
approximately 10.7% of Dalradian's issued and outstanding common shares, 
have entered into a support agreement (the "Support Agreement") with 
Orion, agreeing, subject to the terms of the Support Agreement, to vote 
their Dalradian Shares in favour of the Transaction. Orion and the 
Remaining Shareholders, who collectively hold approximately 72,695,911 
Dalradian Shares, representing approximately 20.4% of Dalradian's issued 
and outstanding common shares, have each agreed to continue to hold its 
Dalradian Shares and also to vote in favour of the Transaction. 
 
   Independent Committee and Board of Directors Recommendations 
 
   An independent committee of Dalradian's board of directors (the 
"Independent Committee") comprised of Jonathan Rubenstein, Patrick 
Downey and Thomas Obradovich was constituted to consider the 
Transaction. The Independent Committee, on behalf of the Dalradian Board 
of Directors, obtained a formal valuation (the "Valuation") from Raymond 
James Ltd. ("Raymond James") as required by Multilateral Instrument 
61-101 - Protection of Minority Security Holders in Special Transactions 
("MI 61-101"). The Valuation was prepared under the supervision of the 
Independent Committee and determined that in Raymond James' opinion, and 
based upon and subject to the assumptions, limitations and 
qualifications set forth therein, the fair market value of the Dalradian 
Shares, as at June 20, 2018 is in the range of C$1.35 to C$1.70 per 
Dalradian Share. In addition, Raymond James has provided a fairness 
opinion to the Independent Committee (the "Raymond James Fairness 
Opinion"), stating that in its opinion, and based upon and subject to 
the assumptions, limitations and qualifications set forth therein, the 
Consideration to be received by the Affected Dalradian Shareholders 
pursuant to the Arrangement Agreement is fair, from a financial point of 
view, to such Affected Dalradian Shareholders. 
 
   Maxit Capital LP has provided a fairness opinion to the Independent 
Committee (the "Maxit Fairness Opinion"), stating that in its opinion, 
and based upon and subject to the assumptions, limitations and 
qualifications set forth therein, the Consideration is fair, from a 
financial point of view, to the Affected Dalradian Shareholders. 
 
   The Board of Directors (excluding Patrick Anderson, Michael Barton and 
Sean Roosen who were recused from discussions and voting given their 
interests in the Transaction as Mr. Anderson is part of the senior 
management team and is a Remaining Shareholder, Mr. Barton is a 
principal of Orion and Mr. Roosen is a Remaining Shareholder and a 
principal of Osisko) after receiving financial and legal advice, and 
following receipt of the Maxit Fairness Opinion, the Raymond James 
Fairness Opinion and the Valuation, and the recommendation of the 
Independent Committee, unanimously approved the Transaction and 
recommend that Affected Dalradian Shareholders vote in favour of the 
Transaction. 
 
   In addition, directors and senior officers of Dalradian, including the 
Remaining Shareholders, who as of the date hereof, collectively hold 
approximately 2.2% of Dalradian's issued and outstanding common shares, 
have entered into agreements to support the Transaction and vote their 
Dalradian Shares in favour of the Transaction. 
 
   Transaction Conditions and Timing 
 
   The Transaction will be implemented by way of a Court-approved plan of 
arrangement under the Business Corporations Act (Ontario) and will 
require the approval of: (i) 66 2/3% of the votes cast by the holders of 
Dalradian's common shares; and (ii) a simple majority of the votes cast 
by holders of Dalradian common shares after excluding any votes of Orion, 
Osisko Gold Royalties Ltd and certain other persons required to be 
excluded under MI 61-101, all at a special meeting of Dalradian 
shareholders to consider the Transaction. 
 
   The completion of the Transaction will also be subject to obtaining 
required court and other approvals and satisfaction of closing 
conditions customary for a transaction of this nature. The Arrangement 
Agreement provides for customary deal-protection provisions, including a 
non-solicitation covenant on the part of Dalradian and a right for Orion 
to match any Superior Proposal (as defined in the Arrangement 
Agreement). The Arrangement Agreement includes a termination fee of C$20 
million, payable by Dalradian, under certain circumstances (including if 
the Arrangement Agreement is terminated in connection with Dalradian 
pursuing a Superior Proposal). 
 
   It is anticipated that the special meeting of Dalradian shareholders to 
consider the Transaction will be held in August 2018. The effect of 
Dalradian shareholders voting for the resolution to approve the plan of 
arrangement and it becoming effective will be the cancellation of the 
Dalradian Shares from trading on the TSX and AIM following closing of 
the Transaction. The Transaction is expected to close in the third 
quarter of 2018. 
 
   No Financing Contingency 
 
   The acquisition will be financed using cash on hand in the Company, made 
available to Orion as a loan, and cash available to Orion. Orion has 
confirmed that it has sufficient cash available to finance the 
consideration for the Transaction. 
 
   Advisors and Counsel 
 
   Maxit Capital LP is acting as financial advisor to Dalradian in 
connection with the Transaction. Cassels Brock & Blackwell LLP is 
serving as Canadian counsel to Dalradian, Blake, Cassels & Graydon LLP 
is serving as counsel to the Independent Committee and Fieldfisher LLP 
is acting as UK counsel to Dalradian. 
 
   Stikeman Elliott LLP is serving as counsel to Orion. 
 
   Bennett Jones LLP is serving as counsel to the senior management team. 
 

   McCarthy Tétrault LLP is serving as counsel to Osisko Gold 
Royalties Ltd. 
 
   Additional Information about the Proposed Transaction 
 
   Copies of the Maxit Fairness Opinion, Raymond James Fairness Opinion, 
the Valuation, and a description of the various factors considered by 
the Board of Directors of the Company in its determination to approve 
the Transaction, as well as other relevant background information, will 
be included in the management information circular to be sent to the 
Company's shareholders at least 21 days in advance of the Special 
Meeting. The management information circular, the Arrangement Agreement, 
the plan of arrangement and certain related documents will be filed with 
the Canadian securities regulators and will be available on SEDAR at 
www.sedar.com. 
 
   About Orion 
 
   Orion Resource Partners is a global alternative investment management 
firm with $4.5 billion under management. Orion specializes in 
institutional metals and mining investment strategies in the base and 
precious metals space. Orion's private equity, hedge fund, and merchant 
service divisions enable it to access in-depth knowledge of the global 
metals and mining supply chain and robust insight into the physical and 
financial demand driving global metals prices. Orion is an industry 
leader in delivering comprehensive and customized financial solutions to 
mining companies and base and precious metals investors. 
 
   About Dalradian Resources Inc. 
 
   Dalradian Resources Inc. is a mineral exploration and development 
company that is focused on advancing its high-grade Curraghinalt Gold 
Project located in Northern Ireland, United Kingdom. The Curraghinalt 
Project is in permitting, with exploration ongoing to build on the 
positive feasibility study released in January 2017. 
 
   This announcement contains inside information for the purposes of 
Article 7 of Regulation (EU) No 596/2014. 
 
   About Osisko Gold Royalties Ltd 
 
   Osisko Gold Royalties Ltd is an intermediate precious metal royalty 
company focused on the Americas that commenced activities in June 2014. 
Osisko holds a North American focused portfolio of over 130 royalties, 
streams and precious metal offtakes. Osisko's portfolio is anchored by 
five cornerstone assets, including a 5% NSR royalty on the Canadian 
Malartic Mine, which is the largest gold mine in Canada. Osisko also 
owns a portfolio of publicly held resource companies, including a 15.5% 
interest in Osisko Mining Inc., a 12.7% interest in Falco Resources Ltd. 
and a 32.4% in Barkerville Gold Mines Ltd. 
 
   Osisko's head office is located at 1100 Avenue des Canadiens-de 
Montréal, Suite 300, Montréal, Québec, H3B 2S2. 
 
   For more information: 
 
   Marla Gale 
 
   Vice President Communications 
 
   [phone] 
 
   [e-mail] 
 
   Grant Thornton UK LLP (Nominated Adviser) 
 
   Philip Secrett / Richard Tonthat 
 
   [phone] 
 
   Numis Securities Limited (Broker) 
 
   John Prior / James Black / Paul Gillam 
 
   [phone] 
 
   FORWARD LOOKING STATEMENTS 
 
   This press release contains "forward-looking information" which may 
include, but is not limited to, statements with respect to management's 
assessment of the anticipated benefits to Dalradian shareholders of the 
proposed Transaction, anticipated meeting date, timing for completion of 
the Transaction and delisting from both the TSX and AIM, the delivery of 
an updated feasibility study and an updated technical report, future 
financial or operating performance of the Company and its subsidiaries 
and its mineral project, the future price of metals, test work and 
confirming results from work performed to date, the estimation of 
mineral resources and mineral reserves, the realization of mineral 
resource and mineral reserve estimates, the timing and amount of 
estimated future production, costs of production, capital, operating and 
exploration expenditures, costs and timing of the development of new 
deposits, costs and timing of future exploration, requirements for 
additional capital, government regulation of mining operations, 
environmental risks, reclamation expenses, title disputes or claims, 
limitations of insurance coverage, the timing and possible outcome of 
pending regulatory matters and the realization of the expected 
production, economics and mine life of the Curraghinalt gold deposit. 
 
   Often, but not always, forward-looking statements can be identified by 
the use of words and phrases such as "plans," "expects," "is expected," 
"budget," "scheduled," "estimates," "forecasts," "intends," "anticipates, 
" or "believes" or variations (including negative variations) of such 
words and phrases, or state that certain actions, events or results "may, 
" "could," "would," "might" or "will" be taken, occur or be achieved. 
 
   Forward-looking statements are based on the opinions and estimates of 
management as of the date such statements are made and are based on 
various assumptions that management believes are reasonable, such as the 
receipt of all shareholder and regulatory approvals, no undue delays 
with respect to the Transaction, effects of general economic conditions, 
changing foreign exchange rates and actions by government authorities, 
continued political stability in Northern Ireland, that permits required 
for Dalradian's operations will be obtained in a timely basis in order 
to permit Dalradian to proceed on schedule with its planned exploration 
and mine development, construction and production programs, that a 
permitting application for mine construction will be approved, that 
skilled personnel and contractors will be available as Dalradian's 
operations commence and continue to grow towards production and mining 
operations, that the price of gold will be at levels that render the 
Dalradian's mineral project economic, and that the necessary capital 
will be available to finance Dalradian's operations and realize on 
mineral resource and mineral reserve estimates and current mine plans. 
 
   Forward-looking statements involve known and unknown risks, 
uncertainties and other factors which may cause the actual results, 
performance or achievements of Dalradian to be materially different from 
any future results, performance or achievements expressed or implied by 
the forward-looking statements. Such factors include, among others, the 
risk that the required Dalradian shareholder approval or necessary court 
approvals may not be obtained in connection with the Transaction, 
uncertainties associated with negotiations, misjudgments in the course 
of preparing forward-looking information, the Transaction may not close 
when planned or at all or on the terms and conditions set forth in the 
Arrangement Agreement, the benefits expected from the Transaction not 
being realized, risks related to the integration of acquisitions, 
general business, economic, competitive, political and social 
uncertainties; legal challenges to permits or permitting applications; 
the actual results of current and future exploration activities; the 
actual results of reclamation activities; conclusions of economic 
evaluations; meeting various expected cost estimates; changes in project 
parameters and/or economic assessments as plans continue to be refined; 
future prices of metals; possible variations of mineral grade or 
recovery rates; the risk that actual costs may exceed estimated costs; 
failure of plant, equipment or processes to operate as anticipated; 
accidents, labour disputes and other risks of the mining industry; 
political instability; delays in obtaining governmental approvals or 
financing or in the completion of development or construction activities, 
as well as those factors discussed in the section entitled "Risk 
Factors" in the Company's Annual Information Form for the year ended 
December 31, 2017 dated March 15, 2018. 
 
   Although the Company has attempted to identify important factors that 
could cause actual actions, events or results to differ materially from 
those described in forward-looking statements, there may be other 
factors that cause actions, events or results to differ from those 
anticipated, estimated or intended. Forward-looking statements contained 
herein are made as of the date of this press release and the Company 
disclaims any obligation to update any forward-looking statements, 
whether as a result of new information, future events or results, except 
as may be required by applicable securities laws. There can be no 
assurance that forward-looking statements will prove to be accurate, as 
actual results and future events could differ materially from those 
anticipated in such statements. Accordingly, readers should not place 
undue reliance on forward-looking statements. 
 
   This announcement is distributed by Nasdaq Corporate Solutions on behalf 
of Nasdaq Corporate Solutions clients. 
 
   The issuer of this announcement warrants that they are solely 
responsible for the content, accuracy and originality of the information 
contained therein. 
 
   Source: Dalradian Resources Inc. via Globenewswire 
 
 
  http://www.dalradian.com/ 
 

(END) Dow Jones Newswires

June 21, 2018 02:03 ET (06:03 GMT)

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