Sprott Molybdenum Participation Corporation Announces Proposed Distribution of Assets
Wed Jun 3, 5:01 PM
ca.news.finance.yahoo.com
TORONTO, June 3 /CNW/ - (TSX: MLY, MLY.WT) - As previously announced, the Corporation proposes to distribute all or substantially all of its assets to its shareholders on or about July 9, 2009 (the "Distribution"). As part of the Distribution, the Corporation has entered into an agreement with an arm's length purchaser pursuant to which the Corporation will issue to the purchaser a 10% secured convertible debenture with a principal amount of $1,350,000 (the "Debenture"). The Debenture will have a maturity of one year and will be convertible into Class A non-voting shares of the Corporation. The net proceeds from the sale of the Debenture will be included in the proceeds distributed to shareholders, but, as a non-shareholder, the holder of the Debenture will not participate in the Distribution.
In exchange for their common shares, shareholders of the Corporation will receive a cash distribution of approximately $1.76 per share and one new common share. This will permit the shareholders to receive a payment of cash along with the opportunity to continue to hold an equity stake in the Corporation. It is expected that the new common shares will be listed and traded on the NEX board of the TSX Venture Exchange.
Shareholders will be asked to vote on the proposed Distribution at the annual and special meeting of shareholders of the Corporation scheduled for June 30, 2009. Details regarding the Distribution will be contained in the management information circular for such meeting, which will be mailed to shareholders on or about June 9, 2009. Certain steps of the Distribution are also subject to regulatory approval.
Net asset value of the Corporation on May 29, 2009 was $1.73 per share of which $1.72 per share was held in cash, accounts receivable and short term securities, net of liabilities. Expected debenture proceeds of $1,350,000 are not reflected in net asset value of the Corporation as at May 29, 2009. The Corporation is continuing to liquidate its existing portfolio investments in an orderly manner, subject to market conditions.
Forward-Looking Statements
Certain statements in this release are "forward-looking statements" management's expectations regarding the Corporation's future growth, results of operations, performance and business prospects and opportunities. Such forward-looking statements reflect management's current beliefs and are based on information currently available to management. Forward-looking statements involve significant risks and uncertainties. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements. Although the forward-looking statements contained in this release are based upon what the Corporation and its manager, Sprott Asset Management LP ( the "Manager"), believe to be reasonable assumptions, neither the Corporation nor the Manager can assure investors that actual results will be consistent with these forward-looking statements. These forward-looking statements are made as of the date of this release, and neither the Corporation nor the Manager assumes any obligation to update or revise them to reflect new events or circumstances.
About Sprott Molybdenum Participation Corporation
-------------------------------------------------
The Corporation is an investment holding company created with the goal of achieving capital appreciation by investing in securities of private and public companies that explore for, mine and/or process molybdenum and by investing in, holding, selling and otherwise transacting in all commercial forms of molybdenum.
Contacts
Investor Services at 1-888-362-7172 |
