Athabasca Minerals Inc., together with its subsidiaries, has entered into a transaction agreement with Badger Mining Corp. for the acquisition of the corporation.
The Transaction is to be implemented by way of a subscription agreement between the corporation and the purchaser, and a reverse vesting order (RVO) to be issued by the Alberta Court of King’s Bench under the Bankruptcy and Insolvency Act (Canada), pursuant to which: i) the existing common shares of Athabasca will be exchanged on a 1:1 basis for shares in a newly incorporated entity termed “ResidualCo”; ii) all other existing equity interests in Athabasca will be cancelled for no consideration; iii) certain existing claims and liabilities will be transferred from the corporation to ResidualCo; and iv) Badger will be issued new shares from the corporation’s treasury and will acquire such shares free and clear of all claims and encumbrances.
Following the conclusion of the implementation of the transaction, Badger will be the sole shareholder of the corporation and existing Athabasca common shareholders will own all of the shares of ResidualCo in the same proportion to their prior shareholdings of Athabasca. The purchase price pursuant to the transaction is approximately CAD$29.2 million, which amount will also be transferred to ResidualCo in accordance with the terms and conditions of the agreement.
The transaction is subject to the satisfaction of certain conditions set out in the agreement, including the issuance of the RVO by the court approving the transaction. The corporation understands that such approval may be challenged by at least one party.
The transaction is a result of the implementation of the corporation’s court-approved sales and investment solicitation process (SISP). On Dec. 15, 2023, the court approved, among other things, the terms of a SISP which included a stalking horse bid from JMAC Energy Services LLC to acquire the corporation’s assets for CAD$13,000,000.
As at the final bid deadline pursuant to the SISP of Jan. 31, it was determined that Badger presented a superior bid. A run-off auction was conducted by KSV Restructuring Inc., in its capacity as the corporation’s proposal trustee, on Friday, February 9, pursuant to the SISP and in accordance with established auction rules. The auction resulted in the purchaser being selected as the successful bidder with the highest and best bid price of CAD$29,200,000.