Acquisition of Surinam Stone & Industries under review by VSE; up to 1m
share private placement
Bomax Resource Corp BXS
Shares issued 6,552,701 Mar 4 close $0.40
Tue 4 Mar 97 News Release
Mr James Bond reports
The agreement whereby the company would acquire all of the outstanding
shares of Surinam Stone & industries NV is under review by the VSE. As
consideration for the SSI shares, the company proposes to issue to the SSI
shareholders a total of up to 25,500,000 fully paid and non-assessable
shares at a deemed price of $0.40. The issuance of the shares may be
subject to an escrow agreement, releasing the shares on the basis of one
share for each $0.40 of audited cash flow.
The major assets of SSI are its contract with Grasshopper Aluminum Company,
NV, a company wholly owned by the government of Surinam, for the
exploitation and marketing of granite blocks from the Patamacca granite
deposit in Surinam and an exclusive world-wide sales agreement related to
the granite quarrying operations of SSI. Other assets of SSI consist of a
contract for the supply of shot-rock and a pending road building contract.
Although these other assets have value, they are not material compared to
the value to be generated from the exploitation and marketing of granite
blocks. SSI also carries on other industrial activities such as road
building, clearing and rock blasting.
A valuation report dated June 1996 and prepared by Ross Glanville &
Associates of Burnaby indicates that the net present value of SSI in the
granite quarry is US$8.0 million. This does not account for the debt of
approximately US$500,000 owing to the company. Consequently the value of
SSI would be approximately US$7-5 million.
The company has been advised that SSI is shipping granite to Europe and
sales have commenced. It is expected SSI should be in a cash flow position
within 30 days of shareholder approval of the SSI acquisition.
The company has rescheduled the annual general meeting for late March 1997
at which approval from shareholders for the proposed SSI transaction will
be sought.
A private placement reported in Stockwatch November 22 1996 of up to
2,500,000 shares at $0.40, with up to 2,500,000 warrants exercisable for
one year at $0.40, extended to March 3 1997, was not completed due to
market conditions.
The company announces a private placement of up to one million shares at
$0.30 with up to one million warrants exercisable for one year at $0.30.
Funds from the private placement will be used for general working capital.
The company anticipates announcing a further financing to raise capital for
the SSI acquisition in the near future. |
