Sprott Resource Corp. Announces Normal Course Issuer Bid
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/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/
TORONTO, Aug. 30, 2011 /CNW/ - (TSX: SCP) - Sprott Resource Corp. ("SRC") is pleased to announce that it intends to commence a normal course issuer bid (the "Bid") to repurchase up to 9.0 million of its common shares (the "Shares"), representing approximately 9.87% of the unrestricted public float of SRC and approximately 7.96% of the total number of issued and outstanding Shares. As at August 26, 2011, there were 113,126,510 Shares of SRC outstanding. Purchases will be made for cancellation through the facilities of the Toronto Stock Exchange (the "TSX") or other Canadian market places at the prevailing market price of the Shares.
SRC has received approval from the TSX to commence the Bid on September 1, 2011. The Bid will end on the earlier of (i) August 31, 2012, (ii) when the number of common shares sought under the Bid have been obtained, and (iii) when notice is given by SRC to the TSX terminating the Bid if SRC determines that it is appropriate to do so. Pursuant to TSX policies, daily purchases made by SRC may not exceed 49,684 Shares, being 25% of the six-month average daily trading volume of 198,738 Shares on the TSX, subject to certain prescribed TSX exceptions including the "block purchase exemption".
SRC believes that its Shares have been trading in a price range that does not adequately reflect the value of the Shares in relation to SRC's assets and future prospects. As a result, SRC believes that, at appropriate times, repurchases through the Bid can enhance shareholder value and represents an attractive investment and an appropriate use of SRC's financial resources.
To the knowledge of SRC, no director or senior officer, no person acting jointly or in concert with SRC and no person holding 10% or more of any Shares of SRC currently intends to sell Shares during the course of the Bid. However, sales by such persons through the facilities of the TSX may occur if the personal circumstances of any such person changes or any such person makes a decision unrelated to the Bid. The benefits to any such person whose Shares are purchased would be the same as the benefits available to all other holders whose Shares are purchased under the Bid. SRC has purchased 279,373 Shares pursuant to a normal course issuer bid during the preceding 12 months at an average cost of
$4.51 per Share. |
