IMX Resources Limited (IXR) and Continental Nickel Limited have entered into a definitive arrangement agreement, pursuant to which IMX has agreed to acquire all the issued and outstanding common shares in the capital of Continental that it does not already own for shares and warrants in the capital of IMX, by way of a Continental plan of arrangement under the Canada Business Corporations Act. The combination of Continental and IMX will see the ownership and control of the Nachingwea Nickel Sulphide Project in Tanzania, consolidated in a single entity. IMX currently owns approximately 37% of the issued capital of Continental. Nachingwea is operated under a joint venture between Continental and IMX, with Continental owning 75% of the JV and IMX owning 25%. Continental is the operator of the Nachingwea Nickel Project.
Neil Meadows, Managing Director of IMX, said: “The combination of IMX and Continental results in a stronger company with an impressive pipeline of high quality projects, including 100% of the potentially significant Nachingwea Nickel Project. With the project under single ownership, there is now a clear path to advance towards commencing nickel production. Dave Massola, President and Chief Executive Officer of Continental, said: “The consolidation of Nachingwea in a larger and more attractive company significantly enhances the potential to unlock value for shareholders through the timely and optimal development of the project. With ongoing operating cash flow from Cairn Hill and a substantially improved profile, the combined company is well placed to continue to fund Nachingwea from both internal and external sources. In addition, Continental shareholders gain exposure to the emerging Mt Woods Magnetite Project in South Australia.”
Under the proposed Arrangement, each Continental shareholder will receive 3.7 IMX ordinary shares plus 0.5 of an ordinary share purchase warrant (equivalent to an option in Australian parlance) for each Continental common share. Each full warrant will entitle the holder to acquire one IMX ordinary share at an exercise price of A$0.60 or C$0.62 per IMX ordinary share (at the sole election of the holder) and will expire three (3) years from completion of the transaction.
Any Continental common shares acquired on exercise of existing Continental options prior to the completion date of the transaction will participate in the Arrangement.
IMX Resources Limited (IXR) is an ASX listed company headquartered in Perth, Western Australia. IMX is a mining and mineral exploration company with an iron ore mining operation in South Australia, and a pipeline of advanced exploration projects in Australia and Africa, focusing on iron ore, nickel, copper and gold. IMX operates and owns 51% of the Cairn Hill Mining Operation, located 55 km south-east of Coober Pedy in South Australia, where it produces a premium coarse-grained magnetite–copper-gold DSO product at a rate of 1.7Mtpa.