Baltic Resources and PhosCan Chemical Finalize Arrangement Agreement; Shareholder Meetings Scheduled for March 4, 2008
February 01 2008 - 3:15PM
Marketwired
TORONTO, ONTARIO announced today that it has entered a
definitive Arrangement Agreement with PhosCan Chemical Corp.
providing for a Plan of Arrangement (the "Arrangement") to
implement the merger originally announced on October 29, 2007 and
has obtained an interim order from the Court of Queen's Bench of
Alberta in respect of the Arrangement. Pursuant to the Arrangement,
Baltic and PhosCan will combine their interest in the Martison
Phosphate Project, in which they each currently hold an equal joint
venture interest.
Pursuant to the Arrangement, Baltic will also transfer to its
newly formed subsidiary, Canadian Orebodies Inc. ("Orebodies") all
of Baltic's assets other than Baltic's interest in the Martison
Phosphate Project and 90% of the proceeds of warrants and options
exercised since October 29, 2007, and Orebodies will assume all of
Baltic's liabilities, other than certain advances made by PhosCan
on Baltic's behalf in respect of the Martison Phosphate Project.
Baltic will then amalgamate with PhosCan's wholly-owned subsidiary,
1366825 Alberta Ltd. The TSXV has granted conditional approval of
the listing of Orebodies shares on the TSXV. Final approval of the
listing is subject to the completion of the Arrangement and all of
the requirements of the TSXV.
Under the Arrangement, Baltic shareholders will receive in
exchange for each common share of Baltic 1.4 common shares of
PhosCan and one common share of Orebodies. Based on the currently
outstanding shares, an aggregate of approximately 51,843,259 common
shares of PhosCan will be issued in exchange for Baltic shares,
such that former Baltic shareholders will hold approximately 37.2%
of the then issued and outstanding common shares of PhosCan. Upon
completion of the Arrangement, three representatives of Baltic,
being Donald McKinnon, Chris Hodgson and Gordon McKinnon, will
become directors of PhosCan.
Each of Baltic and PhosCan will hold shareholders' meetings on
Tuesday, March 4, 2008 to consider the Arrangement and certain
related matters. Completion of the Arrangement is conditional upon,
among other things, the approval of a majority of votes cast by
PhosCan shareholders and at least two-thirds of the votes cast by
Baltic shareholders, as well as final court approval. The boards of
directors of each of PhosCan and Baltic have approved the
Arrangement and have unanimously recommended that shareholders vote
in favour of approval of the Arrangement.
Donald McKinnon, President and CEO of Baltic, commented "We
believe the merger between Baltic and PhosCan to consolidate
interests in the Martison Project is an instrumental step that will
accelerate the project and provide excellent value for our
shareholders. Also, it will allow Canadian Orebodies to focus on
its non phosphate projects and we look forward to an exciting year
with the new company".
About Baltic and PhosCan
Baltic and PhosCan are engaged through a joint venture agreement
in the advancement of the Martison Phosphate Project located near
Hearst, Ontario. The Martison Project entails the development of a
phosphoric acid plant, utilizing the Martison phosphate deposit and
sulphuric acid from Ontario base-metal smelters. Phosphate
concentrate and sulphuric acid are the two primary inputs in the
production of phosphoric acid. The Martison Project is
strategically positioned in proximity to target markets with access
to excellent infrastructure including rail, power, labour and an
abundant supply of sulphuric acid. The phosphoric acid produced
will be used as feedstock for the production of higher valued
products in the fertilizer and industrial markets that provide both
an economic and logistical advantage.
Baltic Resources Inc., PhosCan Chemical Corp.
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements with
respect to the Arrangement, and matters concerning the business,
operations, strategy, and financial performance of Baltic and
PhosCan. These statements generally can be identified by use of
forward-looking words such as "may", "will", "expect", "estimate",
"anticipate", "intends", "believe" or "continue" or the negative
thereof or similar variations. Such forward-looking statements are
qualified in their entirety by the inherent risks and uncertainties
surrounding future expectations, including that the transaction
contemplated herein is completed. Forward-looking statements are
based on a number of assumptions which may prove to be incorrect.
Unless otherwise stated, all forward looking statements speak only
as of the date of this press release and Baltic does not undertake
any obligation to update such statements except as required by
law.
Contacts: Baltic Resources Inc. Donald McKinnon President &
CEO (705) 268-9000 Baltic Resources Inc. Gordon McKinnon Manager
Corporate Development (705) 268-9000 Website:
www.balticresources.ca
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