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Gold/Mining/Energy : BRO-X MINERALS (C.BXO) -- Ignore unavailable to you. Want to Upgrade?

To: maps who wrote (310)	3/18/1999 6:04:00 PM
From: Lalit Jain	Respond to of 363

From the Calgary Herald: Thursday 18 March 1999 Bro-X may become Valient Shareholders OK moves to distance firm from Bre-X Vicki Barnett, Calgary Herald The son of Bre-X is poised to start a new life under a different name. Shareholders in Bro-X Minerals Ltd. voted Wednesday to try to breathe new life into the firm and disassociate it from scandal-plagued parent company Bre-X Minerals Ltd. Shareholders at the Bro-X annual meeting in Calgary voted in favour of a rights offering that could ultimately allow Bro-X to disentangle itself from the Bre-X fiasco. If the rights offering is successful, the company will change its name to Valient Ventures Ltd. under an initiative approved Wednesday by shareholders and proxy holders with 35 per cent of the eight million outstanding shares. The family of deceased Bre-X president David Walsh, who own one million Bro-X shares, did not send in their proxies. While Bre-X and another related company, Bresea Resources Ltd., face massive lawsuits stemming from the Bre-X gold mining fraud in Indonesia, "Bro-X has never been sued by anyone," said Calgary lawyer Jim Rooney, who represents both Bro-X and Bresea. The new president of Bro-X is Tom Devlin -- "the last man standing" at the Bre-X offices in Calgary, said Rooney. Devlin, an accountant holding 41,000 Bro-X shares, was never an officer or director of any of the Bre-X group of companies, Rooney said. Also elected as Bro-X directors at the meeting were Lorne Scott, a Calgary lawyer, and George Hill, president of Ryjen Resources Inc. If the rights offering is approved, Bro-X will be free to attempt to get itself relisted on the Alberta Stock Exchange and carry on business. Calgarian Roger Koss -- whose business card describes him as "retired and broke" -- said he hopes Bresea will also "breathe again because that's where the bulk of my holdings are." Koss admits to losing $60,000 in Bre-X and another $60,000 on Bresea. Asked whether he'd invest in a gold-mining company again, he responded, "Bre-X was nothing but a moose pasture, and I wouldn't invest in a moose pasture again." Under the rights offering approved Wednesday, Bro-X would offer one right per common share held. For 10 cents per share held, the investor would receive a unit consisting of a preferred Bro-X share and a warrant for one common share, with an exercise price of 10 cents. The preferred share would be convertible into two common shares. Six months ago, Bresea -- which owns two million preferred shares in Bro-X -- demanded the right to redeem those shares for all of Bro-X's $860,000. Bro-X said the move would bankrupt it, and declined payment for legal reasons. Under a compromise struck by the two companies earlier this year, if the rights offering is successful, Bresea will receive $750,000 and convert the balance of its Bro-X preferred shares into 6.25 million common shares. In return, Bro-X would become an obligation-free shell company that could once again do business. Bro-X could raise up to $2 million on its rights offering, which will be concluded by the end of April. "It's a good deal for both companies. Bresea gets most of the dough and an upside on Bro-X stock, while Bro-X gets a new life," Rooney said. If $750,000 isn't raised through the rights offering, Br0-X dies and Bresea gets the treasury, he said. However, a successful offering would likely see Bro-X seeking a new marriage partner. Last September, merger plans existed between Bro-X and Toronto-based MacDonald Oil that holds an exploration block in Cuba. Frank Smeenk, the chairman of MacDonald Mines and MacDonald Oil Exploration Ltd. who wants to look for oil and gold in Cuba, attended the Bro-X meeting and held discussions with Devlin following the meeting. Bro-X shares were first traded on the ASE in October 1996 at $3.50 each. They climbed as high as $5.50 and levelled off between $2 and $2.50 prior to the discovery of the world's biggest-ever gold mining fraud in March 1996 at the Bre-X site in Indonesia. Since then, the company has been in limbo. calgaryherald.com