VANCOUVER, BC / ACCESSWIRE / July 4, 2022 / CoTec Holdings Corp. (TSXV: CTH) ("CoTec" or the "Corporation") is pleased to announce that MagIron LLC ("MagIron"), in which the Corporation has a 15.8% equity interest, has completed the purchase of selected assets from the receivership estate of Prairie River Minerals, LLC ("PRM") (the "Acquisition").
Julian Treger, CoTec CEO commented; "this acquisition significantly enhances the MagIron business case through consolidation of the adjacent land package, secured access to substantial additional feedstock, control over the infrastructure and valuable equipment, all at a deep discount to intrinsic value. This is another big step forward for MagIron in the execution of its strategy."
The Acquisition follows an order approving the free and clear sale of PRM assets to MagIron by a State of Minnesota district court in the Assignment for the Benefit of Creditors action on May 13, 2022.
The Acquisition is of significant strategic interest to MagIron, allowing it to consolidate the land package surrounding Plant 4, together with in-ground mineral rights, additional stockpiles of residual iron units and inventory of lump ore finished product. It also provides MagIron with exclusive control of the Jessie Load Out rail facility and surrounding infrastructure and various plant and equipment fixtures at PRM's two processing plants, mobile equipment, spare parts, and useful permits and contracts.
In addition to de-risking and enhancing the value of MagIron's restart strategy for Plant 4, the acquired assets provide MagIron with the capability to produce iron ore sinter fines and lump ore using PRM's Ultra-High Density Media technology which could potentially accelerate the generation of positive cash flows, subject to market conditions.
The purchase consideration for the Acquisition comprises cash payments of US$2.6 million and the acceptance of debt of US$6.05 million. The cash consideration will be funded from the recently announced US$5 million funding.
CoTec is an ESG-focused company investing in innovative technologies that have the potential to fundamentally change the way metals and minerals can be extracted and processed for the purpose of applying those technologies to undervalued operating assets, as the Company seeks to transition into a mid-tier mineral resource producer. The Company is committed to supporting the transition to a lower carbon future for the extraction industry, a sector on the cusp of a green revolution as it embraces technology and innovation.
CoTec is a publicly traded mining issuer listed on the Toronto Venture Stock Exchange and trades under the symbol CTH.V
For further information, please contact:
Braam Jonker - (604) 992-5600
Forward-Looking Information Cautionary Statement
Statements in this press release regarding the Corporation's and MagIron's businesses and the Corporation's investment in MagIron which are not historical facts are "forward-looking statements" that involve risks and uncertainties, including statements relating to management's expectations with respect to MagIron's strategy, funding, acquisition of and value of the PRM assets, development and operation of Plant 4 and the benefits to the Corporation which may be implied from such statements. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties. Actual results in each case could differ materially from those currently anticipated in such statements. For further details regarding risks and uncertainties facing the Corporation please refer to "Risk Factors" in the Corporation's filing statement dated April 6, 2022, a copy of which may be found under the Corporation's SEDAR profile at www.sedar.com.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.
SOURCE: CoTec Holdings Corp.