{"id":11097,"date":"2024-10-15T17:51:57","date_gmt":"2024-10-15T17:51:57","guid":{"rendered":"https:\/\/businesstriumphs.com\/index.php\/2024\/10\/15\/dore-copper-and-cygnus-metals-enter-into-arrangement-agreement-to-create-strategic-critical-minerals-company\/"},"modified":"2024-10-15T17:51:57","modified_gmt":"2024-10-15T17:51:57","slug":"dore-copper-and-cygnus-metals-enter-into-arrangement-agreement-to-create-strategic-critical-minerals-company","status":"publish","type":"post","link":"https:\/\/businesstriumphs.com\/index.php\/2024\/10\/15\/dore-copper-and-cygnus-metals-enter-into-arrangement-agreement-to-create-strategic-critical-minerals-company\/","title":{"rendered":"Dor\u00e9 Copper and Cygnus Metals Enter Into Arrangement Agreement to Create Strategic Critical Minerals Company"},"content":{"rendered":"
\n

Not for distribution to United States news wire services or for dissemination in the United States <\/em><\/strong><\/p>\n

Dor\u00e9 Copper Mining Corp. (\u2018 Dor\u00e9 Copper \u2018) (TSXV: DCMC; OTCQB: DRCMF; FRA: DCM) is pleased to announce that it has entered into a definitive arrangement agreement (the\u00a0\u2018 Agreement \u2018) on October 14, 2024 with Cygnus Metals Limited (ASX: CY5) (\u2018 Cygnus \u2018) to combine their respective businesses in a merger of equals transaction, pursuant to which Cygnus has agreed to acquire 100% of the issued and outstanding common shares of Dor\u00e9 Copper (the \u2018 Dor\u00e9 Copper Shares \u2018) by way of a court approved plan of arrangement under the Canada Business Corporation Act (the\u00a0\u2018 Transaction \u2018).<\/p>\n

This Transaction will create a Qu\u00e9bec-focused critical minerals explorer and developer with high-grade copper and lithium resources. The merger of equals will bring together proven members of management with strong capital markets experience, project development, mine building and operational expertise and a proven track record of mineral discoveries. <\/p>\n

Pursuant to the terms of the Agreement, holders of Dor\u00e9 Copper Shares will receive 1.8297 ordinary shares of Cygnus (\u2018 Cygnus Shares <\/strong> \u2018) in exchange for each Dor\u00e9 Copper Share (the \u2018 Exchange Ratio <\/strong> \u2018) held immediately prior to the effective time of the Transaction (the \u2018 Effective Time <\/strong> \u2018). The Exchange Ratio is based on an approximate 5-day volume-weighted average price of Dor\u00e9 Copper Shares on the TSX Venture Exchange (\u2018 TSXV<\/strong> \u2018) and Cygnus Shares on the Australian Stock Exchange (\u2018 ASX <\/strong> \u2018) as at October 11, 2024. This represents an implied value of C$0.141 per Dor\u00e9 Copper Share 1 and an implied equity value for Dor\u00e9 Copper of C$24 million 2 . As of the date of the Agreement, existing shareholders of Dor\u00e9 Copper (\u2018 Dor\u00e9 Copper <\/strong>\u00a0 Shareholders <\/strong> \u2018) and shareholders of Cygnus will own approximately 45% and 55%, respectively, of the outstanding Cygnus Shares following completion of the Transaction (before taking into account the Cygnus Equity Raise (as defined below)). In connection with the Transaction, Cygnus intends to complete an equity raise of Cygnus Shares for aggregate gross proceeds of up to a maximum of A$11 million (with a minimum of A$5 million) (the \u2018 Cygnus Equity Raise <\/strong> \u2018). The net proceeds of the Cygnus Equity Raise are expected to be used for, among other things, advancing the Chibougamau project (assuming the Transaction is completed) and Cygnus\u2019 James Bay lithium projects. Pursuant to the Agreement, Cygnus has covenanted to use commercially reasonable best efforts to complete the Cygnus Equity Raise. <\/p>\n

Transaction Strategic Rationale <\/strong><\/p>\n

Diversified Pipeline and Geographical Synergies: <\/strong> The addition of Cygnus\u2019 quality lithium projects in James Bay, Qu\u00e9bec, including Pontax, Auclair and Sakami, to Dor\u00e9 Copper\u2019s high-grade copper assets, expands the asset portfolio of the combined company and provides an opportunity to leverage potential geographical synergy between the lithium properties and Dor\u00e9 Copper\u2019s processing facility near Chibougamau. Strong Combined Management: <\/strong> The combined company is expected to benefit from the unique combination of Cygnus\u2019 and Dor\u00e9 Copper\u2019s management teams providing for strong capital markets experience and proven exploration success, project development and operational expertise. Capital Markets Presence and Financial Strength: <\/strong> As Cygnus intends to apply for and obtain the listing of the Cygnus Shares on the TSXV as a condition to closing, the Transaction represents an opportunity to elevate the global profile and capital markets presence of the combined company with a dual ASX and TSXV listing. Supported Transaction: <\/strong> The Transaction is supported by Dor\u00e9 Copper\u2019s largest shareholders and key strategic investors, Ocean Partners Holdings Limited (\u2018 Ocean Partners <\/strong> \u2018) and Equinox Partners Investment Management, LLC (\u2018 Equinox Partners <\/strong> \u2018), as well as its directors and officers, who have entered into voting support agreements. <\/p>\n

Dor\u00e9 Copper President and Chief Executive Officer, Ernest Mast, commented: \u2018 The Dor\u00e9 Copper team is looking forward to working with the Cygnus team to create a critical metals company and to maximize the value of our quality assets in Chibougamau. This merger will provide the funding, additional expertise and the strategy to generate superior shareholder returns through brownfields exploration and to implement a profitable hub-and-spoke operation in the Chibougamau mining camp. <\/em> \u2018 <\/p>\n

Cygnus Executive Chairman, David Southam, stated: \u2018 This merger is an exceptional opportunity to create value for both groups of shareholders. By combining the proven exploration and management skills of the Cygnus team with the high-grade copper resources and immense upside potential at the Chibougamau properties, we have the potential to unlock substantial value. We intend to devise and implement an aggressive exploration program, utilizing highly experienced geologists and the latest technology, with the aim of driving strong resource growth at a time when the world desperately wants more copper from tier-one locations. <\/em><\/p>\n

Being able to combine our skill sets with a Qu\u00e9bec-based team who has experience in building large resource projects with support from the local communities also provides us with those local connections and experience to assist in advancing our lithium projects in a better macro environment.\u2019 <\/em><\/p>\n

Benefits to Dor\u00e9 Copper Shareholders <\/strong><\/p>\n

Enhanced Liquidity: <\/strong> The increased size of the combined company and anticipated dual listing (ASX and TSXV) of the Cygnus Shares is expected to provide for greater liquidity and access to additional capital markets for shareholders of the combined company. Diversification of Asset Base: <\/strong> Dor\u00e9 Copper Shareholders will gain exposure to Cygnus\u2019 quality lithium projects in James Bay, Qu\u00e9bec, including the Pontax project, with its JORC Mineral Resource Estimate, while retaining participation in any future upsize from the Chibougamau high-grade copper assets and Dor\u00e9 Copper\u2019s exploration portfolio. Pathway for Accelerated Exploration to Enhance Hub-and Spoke Operation Model: <\/strong> It is expected that the combined company will systematically explore the Chibougamau mining camp using modern exploration techniques and geophysics with the objective of growing the resource inventory. Leveraging Cygnus Team Proven Track Record of Success in Both Exploration, Development and Production Companies: <\/strong> The Cygnus team has been involved in certain transactions which returned significant shareholder value over time such as Bellevue Gold, Mincor Resources, Firefly Metals Limited, Andean Silver Limited, Ramelius Resources and Kidman Resources. <\/p>\n

Summary of Transaction Terms <\/strong><\/p>\n

Pursuant to the terms and conditions of the Agreement, Dor\u00e9 Copper Shareholders will receive 1.8297 fully paid Cygnus Shares for each Dor\u00e9 Copper Share held immediately prior to the Effective Time, implying a consideration of C$0.141 per Dor\u00e9 Copper Share. In addition, (i) all outstanding stock options of Dor\u00e9 Copper immediately prior to the Effective Time shall be exchanged for replacement options of Cygnus and exercisable to acquire such number of Cygnus Shares at such exercise price in accordance with the Exchange Ratio, (ii) all outstanding deferred share units of Dor\u00e9 Copper immediately prior to the Effective Time (whether vested or unvested) will be deemed to have been unconditionally vested and immediately redeemed and cancelled in consideration for Dor\u00e9 Copper Shares prior to the exchange for Cygnus Shares; and (iii) all outstanding warrants of Dor\u00e9 Copper will be adjusted in accordance with their terms and become exercisable, based on the Exchange Ratio, to purchase Cygnus Shares on substantially the same terms and conditions. <\/p>\n

The Transaction will be effected by way of a court-approved plan of arrangement under the Canada Business Corporations Act <\/em> and will require the approval of (a) at least 66 2\/3% of the votes cast by Dor\u00e9 Copper Shareholders, and (b) if necessary, a simple majority of the votes cast by Dor\u00e9 Copper Shareholders, excluding certain related parties as prescribed by Multilateral Instrument 61-101 \u2013 Protection of Minority Security Holders in Special Transactions, <\/em> in each case, voting in person or represented by proxy at a special meeting of Dor\u00e9 Copper Shareholders to consider the Transaction (the \u2018 Dor\u00e9 Meeting <\/strong> \u2018). The Dor\u00e9 Meeting is expected to be held in December 2024. <\/p>\n

Dor\u00e9 Copper\u2019s major shareholders, Equinox Partners and Ocean Partners and each director and officer of Dor\u00e9 Copper, representing, in the aggregate, approximately 61.34% of the issued and outstanding Dor\u00e9 Copper Shares, have entered into voting support agreements with Cygnus, pursuant to which each of them has agreed to, among other things, vote in favour of the Transaction at the Dor\u00e9 Meeting. <\/p>\n

The Agreement includes customary representations and warranties for a transaction of this nature as well as customary interim period covenants regarding the operation of Cygnus\u2019 and Dor\u00e9 Copper\u2019s businesses. The Agreement also provides for customary deal protection provisions including fiduciary-out provisions, non-solicitation covenants and a right to match any superior proposal as defined by the Agreement as well as a termination fee payable to Cygnus in certain circumstances. <\/p>\n

Completion of the Transaction is subject to customary conditions, including, among others, court approval, regulatory approval and Dor\u00e9 Copper Shareholder approval. In addition to customary closing conditions, the Transaction is also subject to the receipt of conditional approval of the TSXV for the listing of the Cygnus Shares. <\/p>\n

Subject to the satisfaction (or waiver) of all conditions to closing set out in the Agreement, it is anticipated that the Transaction will be completed in December 2024. Upon closing of the Transaction, it is expected the Dor\u00e9 Copper Shares will be delisted from the TSXV. <\/p>\n

Further information regarding the Transaction will be included in a management information circular (the \u2018 Circular <\/strong> \u2018) to be delivered to Dor\u00e9 Copper Shareholders in connection with the Dor\u00e9 Meeting. Copies of the Circular, the Agreement, the voting support agreements and certain related documents will be filed with the applicable Canadian securities regulators and will be available on SEDAR+ at www.sedarplus.ca . <\/p>\n

Board of Directors and Management <\/strong><\/p>\n

Upon closing of the Transaction, it is presently anticipated that the board of the combined company will be comprised of three (3) directors from each of Cygnus and Dor\u00e9 Copper. In addition, it is expected that David Southam, current Executive Chair of Cygnus, will remain as Executive Chair of the combined company and Ernest Mast, current President and Chief Executive Officer of Dor\u00e9 Copper, will be the President and Managing Director of the combined company. The remainder of the board of the combined company will be comprised of two (2) non-executive directors from each company: Kevin Tomlinson (Canada based) and Raymond Shorrocks (Australia based) from Cygnus, and Mario Stifano, current Executive Chairman of Dor\u00e9 Copper, and Brent Omland from Dor\u00e9 Copper. <\/p>\n

Special Committee and Board Recommendations and Fairness Opinion <\/strong><\/p>\n

The board of directors of Dor\u00e9 Copper (the \u2018 Board <\/strong> \u2018), having received a unanimous recommendation from a special committee comprised solely of independent directors of Dor\u00e9 Copper (the \u2018 Special Committee <\/strong> \u2018) and after receiving outside legal and financial advice, unanimously determined that the Transaction is in the best interests of Dor\u00e9 Copper and is fair to the Dor\u00e9 Copper Shareholders and unanimously recommends that Dor\u00e9 Copper Shareholders vote in favour of the Transaction. In making their respective determinations, the Board and the Special Committee considered, among other factors, the oral fairness opinion of Paradigm Capital Inc. (\u2018 Paradigm Capital <\/strong> \u2018) to the effect that as of the date hereof, subject to the assumptions, limitations and qualifications contained in its opinion, the consideration to be received by Dor\u00e9 Copper Shareholders pursuant to the Transaction is fair, from a financial point of view to the Dor\u00e9 Copper Shareholders. A copy of the fairness opinion of Paradigm Capital will be included in the Circular. <\/p>\n

Advisors and Counsel <\/strong><\/p>\n

Dor\u00e9 Copper has engaged Paradigm Capital, who has provided a fairness opinion in respect of the Transaction, Bennett Jones LLP as Canadian legal advisor and Thomson Geer as Australian legal advisor in relation to the Transaction. <\/p>\n

Cygnus has engaged Canaccord Genuity Corp. as financial advisor, Hamilton Locke as Australian legal advisor and Osler, Hoskin & Harcourt LLP as Canadian legal advisor in relation to the Transaction. <\/p>\n

Canaccord Genuity and Euroz Hartleys are acting as joint lead managers to the Cygnus Equity Raise. <\/p>\n

Qualified Persons <\/strong><\/p>\n

All scientific and technical data contained in this news release has been reviewed and approved by Ernest Mast, P.Eng, President and CEO of Dor\u00e9 Copper, and Jean Tanguay, P.Geo., General Manager of Dor\u00e9 Copper, Qualified Persons within the meaning of National Instrument 43-101 \u2013 Standards of Disclosure for Mineral Projects <\/em> . <\/p>\n

About Dor\u00e9 Copper Mining Corp. <\/strong><\/p>\n

Dor\u00e9 Copper Mining Corp. aims to be the next copper producer in Qu\u00e9bec with an initial production target of +50 million pounds of copper equivalent annually by implementing a hub-and-spoke operation model with multiple high-grade copper-gold assets feeding its centralized Copper Rand mill 3 . Dor\u00e9 Copper has delivered its PEA in May 2022 and is proceeding with a feasibility study. Dor\u00e9 Copper has consolidated a large land package in the prolific Lac Dor\u00e9\/Chibougamau and Joe Mann mining camps that has historically produced 1.6 billion pounds of copper and 4.4 million ounces of gold. 4 The land package includes 13 former producing mines, deposits and resource target areas within a 60-kilometer radius of Dor\u00e9 Copper\u2019s Copper Rand Mill. <\/p>\n

About Cygnus Metals <\/strong><\/p>\n

Cygnus Metals Limited (ASX: CY5) is an emerging exploration company focused on advancing the Pontax Lithium Project (earning up to 70%), the Auclair Lithium Project and the Sakami Lithium Project in the world class James Bay lithium district in Qu\u00e9bec, Canada. In addition, Cygnus has REE and base metal projects at Bencubbin and Snake Rock in Western Australia. The Cygnus Board of Directors and Technical Management team have a proven track record of substantial exploration success and creating wealth for shareholders and all stakeholders in recent years. Cygnus\u2019 tenements range from early-stage exploration areas through to advanced drill-ready targets. <\/p>\n

For further information about Dor\u00e9 Copper, please contact: <\/p>\n

Ernest Mast Laurie Gaborit President and Chief Executive Officer Vice President, Investor Relations Phone: (416) 792-2229 Phone: (416) 219-2049 Email: ernest.mast@dorecopper.com Email: laurie.gaborit@dorecopper.com <\/div>\n

Visit: www.dorecopper.com
Facebook: Dor\u00e9 Copper Mining
LinkedIn: Dor\u00e9 Copper Mining Corp.
Twitter: @DoreCopper
Instagram: @DoreCopperMining <\/p>\n

Cautionary Note Regarding Forward-Looking Statements <\/strong>
This news release includes certain \u2018forward-looking statements\u2019 under applicable Canadian securities legislation. Forward-looking statements include predictions, projections and forecasts and are often, but not always, identified by the use of words such as \u2018seek\u2019, \u2018anticipate\u2019, \u2018believe\u2019, \u2018plan\u2019, \u2018estimate\u2019, \u2018forecast\u2019, \u2018expect\u2019, \u2018potential\u2019, \u2018project\u2019, \u2018target\u2019, \u2018schedule\u2019, \u2018budget\u2019 and \u2018intend\u2019 and statements that an event or result \u2018may\u2019, \u2018will\u2019, \u2018should\u2019, \u2018could\u2019 or \u2018might\u2019 occur or be achieved and other similar expressions and includes the negatives thereof. All statements other than statements of historical fact included in this news release, including, without limitation, statements with respect to the proposed Transaction and the terms thereof, the proposed benefits to be derived from the Transaction, including, but not limited to, the goals, strategies, opportunities, technologies used, project timelines and funding requirements, impact of combined management expertise and prospective shareholding, the anticipated date of the Dor\u00e9 Meeting, the anticipated filing of materials on SEDAR+, the completion of the Transaction, including, receipt of all necessary court, shareholder and regulatory approvals and timing thereof, the proposed Cygnus Equity Raise and the terms thereof, the proposed use of proceeds of the Cygnus Equity Raise, the expectation that the Dor\u00e9 Copper Shares will be delisted from the TSXV, the expectation that the Cygnus Shares will be dual-listed on the ASX and TSXV, and the plans, operations and prospects of Dor\u00e9 Copper and its properties are forward-looking statements. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties and other factors which may cause actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to, the ability to obtain approvals in respect of the Transaction and to consummate the Transaction, the ability to obtain approvals for the listing of the Cygnus Shares on the TSXV, the ability to complete the Cygnus Equity Raise and the timing thereof, integration risks, actual results of current and future exploration activities, benefit of certain technology usage, the ability of prior successes and track record to determine future results, changes in project parameters and\/or economic assessments, availability of capital and financing on acceptable terms, general economic, market or business conditions, future prices of metals, uninsured risks, risks relating to estimated costs, regulatory changes, delays or inability to receive required regulatory approvals, health emergencies, pandemics and other exploration or other risks detailed herein and from time to time in the filings made by Dor\u00e9 Copper with securities regulators. Although Dor\u00e9 Copper has attempted to identify important factors that could cause actual actions, events or results to differ from those described in forward-looking statements, there may be other factors that cause such actions, events or results to differ materially from those anticipated. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Dor\u00e9 Copper disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. <\/em><\/p>\n

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 release. <\/em><\/strong><\/p>\n

1 Based on the Exchange Ratio multiplied by the closing price of Cygnus Shares on the ASX of A$ 0.083 on October 11, 2024, and converted to C$0.077 using AUD\/CAD exchange rate of 0.9277.
2 Based on the implied value of the Dor\u00e9 Copper Shares multiplied by Dor\u00e9 Copper\u2019s 169,258,863 undiluted shares.
3 Technical report titled \u2018Preliminary Economic Assessment for the Chibougamau Hub-and-Spoke Complex, Qu\u00e9bec, Canada\u2019 dated June 15, 2022, in accordance with National Instrument 43-101\u00a0\u2013 Standards of Disclosure for Mineral Projects <\/em> (\u2018 NI 43-101 <\/strong> \u2018). The Technical Report was prepared by BBA Inc. with several consulting firms contributing to sections of the study, including SLR Consulting (Canada) Ltd., SRK Consulting (Canada) Inc. and WSP Inc.
4 Sources for historic production figures: Economic Geology, v. 107, pp. 963\u2013989 \u2013 Structural and Stratigraphic Controls on Magmatic, Volcanogenic, and Shear Zone-Hosted Mineralization in the Chapais-Chibougamau Mining Camp, Northeastern Abitibi, Canada by Fran\u00e7ois Leclerc et al. (Lac Dore\/Chibougamau mining camp) and NI 43-101 Technical Report on the Joe Mann Property dated January 11, 2016 by Geologica Groupe-Conseil Inc. for Jessie Ressources Inc. (Joe Mann mine). <\/p>\n<\/p>\n<\/div>\n

News Provided by GlobeNewswire via QuoteMedia<\/p>\n<\/p>\n

This post appeared first on investingnews.com<\/div>\n","protected":false},"excerpt":{"rendered":"

Not for distribution to United States news wire services or for dissemination in the United States Dor\u00e9 Copper Mining Corp. (\u2018 Dor\u00e9 Copper \u2018) (TSXV: DCMC; OTCQB: DRCMF; FRA: DCM) is pleased to announce that it has entered into a definitive arrangement agreement (the\u00a0\u2018 Agreement \u2018) on October 14, 2024 with Cygnus Metals Limited (ASX: […]<\/p>\n","protected":false},"author":0,"featured_media":11098,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[],"class_list":["post-11097","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-investing"],"_links":{"self":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/11097","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/comments?post=11097"}],"version-history":[{"count":0,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/11097\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media\/11098"}],"wp:attachment":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media?parent=11097"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/categories?post=11097"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/tags?post=11097"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}