IE has reached a definitive deal to acquire the stake it does not already own in Kaizen Discovery.
Via its Ivanhoe Electric (BVI) subsidiary, IE presently owns 54.4 million shares or around an 82.45% stake in Kaizen.
Under the terms of the latest agreement, Kaizen shareholders will receive one share in IE for every 127 shares held.
According to IE, the takeover will allow Kaizen shareholders to take part in IE’s potential future increase in value.
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Kaizen shareholders can avoid “highly-dilutive” equity financings, which are needed if the company plans to adopt a ‘go-alone’ strategy.
They can participate in the IE business after the agreement’s closure.
This deal is pending stock exchange, regulatory and British Columbia Supreme Court approvals.
IE stated that for Kaizen’s outstanding options, deferred share units (DSUs) and restricted share units (RSUs) will immediately vest prior to the effective time of the agreement.
While the holders of DSU and RSU options will receive IE shares as per the agreement, the holders of outstanding options will receive in-the-money value for such options in IE shares.
Canadian mineral exploration company Kaizen Discovery was formed by a combination of Concordia Resource and assets acquired from High Power Exploration’s subsidiary HPX TechCo.
The company solely owns Pinaya, a project covering 100.65km² in the Andahuaylas-Yauri Porphyry Belt in south-eastern Peru.
This project’s estimated measured resources total around 8.2 million tonnes (t) of copper at 0.33% and 0.60 grams per tonne (g/t) of gold, for contained metal of 27,000t of copper and 158,000oz of gold.
In July this year, IE formed a joint venture (JV) with Ma’aden to explore gold, copper silver and rare earth metals in Saudi Arabia.
Named Ma’aden Ivanhoe Electric Exploration and Development, the JV will conduct exploration activities on nearly 48,500km² of unexplored land in Arabian Shield.