SunOpta Announces Opta Minerals to Make Cash Offer for WGI Heavy Minerals, Inc.
In connection with the execution of the Support Agreement, all of the directors and officers of WGI and certain of its significant shareholders, collectively holding approximately 61.3% of the outstanding WGI common shares on a fully-diluted basis, entered into lock-up agreements with Opta, pursuant to which they have agreed to tender to the Offer all of the WGI common shares held by them.
16 Jul 2012 --- SunOpta Inc. announced that Opta Minerals Inc. and WGI Heavy Minerals, Incorporated have entered into a support agreement (the "Support Agreement"), pursuant to which Opta has agreed to make an offer to acquire all of the outstanding common shares of WGI for C$0.60 in cash per share by way of a take-over bid (the "Offer"). The Offer values WGI at approximately C$15.45 million on a fully-diluted basis.
WGI sources, processes and markets industrial abrasive minerals, primarily garnet. WGI also sources, assembles and sells ultra-high pressure waterjet cutting machine replacement parts and components. In their most recent fiscal year WGI realized revenues of C$37.8 million. The product portfolio and global geographic reach of the WGI business is expected to be a good fit with Opta, and is also expected to generate efficiencies and synergies as the capabilities of the organizations are leveraged.
David Kruse, President and Chief Executive Officer of Opta, commented, "We are very pleased to propose this all cash share offer. WGI will be a strategic acquisition for our industrial minerals segment and will be integrated with our other businesses. WGI will further expand our geographic reach to better service current and potential customers throughout the Americas, Europe, Asia and the Middle East. The acquisition of WGI will also provide Opta the opportunity to further leverage our business in the industrial minerals, steel and magnesium segments."
In connection with the execution of the Support Agreement, all of the directors and officers of WGI and certain of its significant shareholders, collectively holding approximately 61.3% of the outstanding WGI common shares on a fully-diluted basis, entered into lock-up agreements with Opta, pursuant to which they have agreed to tender to the Offer all of the WGI common shares held by them (including common shares issuable upon exercise of options).
The Offer will be subject to certain customary conditions, including a minimum tender provision whereby at least 66 2/3% of the outstanding WGI common shares calculated on a fully-diluted basis will have been tendered prior to the expiry date of the Offer, and also subject to no event having occurred that has had, or that could reasonably be expected to have, a material adverse effect in respect of WGI. The Offer is not subject to any financing condition.
Provided that the minimum tender condition is met and Opta takes up and pays for the WGI common shares tendered to the Offer, Opta has agreed to take steps available to it under relevant corporate and securities laws to acquire any WGI common shares that remain outstanding following the completion of the Offer.
Steve Bromley, President and CEO of SunOpta commented, "We are very pleased with Opta's agreement to make a cash offer for the shares of WGI. We believe this transaction, if completed, will further expand Opta's product offering and geographic reach, but most importantly, position Opta as a key global player in industrial minerals and in doing so, enhance shareholder value. As previously noted, late last year the board of directors of Opta decided to suspend the strategic review process due in part to the belief that a number of near-term growth opportunities, when completed, would increase Opta's overall value. In late 2011, Opta completed the acquisition of Inland RC, LLC, a supplier to the mill and foundry industry located in Cleveland, Ohio, and in February 2012, it completed the acquisition of Babco Industrial Corp. Babco is an industrial processor and supplier of petroleum coke, synthetic slag, ladle sand and crushed graphite located in Regina, Saskatchewan. The addition of WGI is yet another step in this plan, further expanding Opta's global presence. We believe that these initiatives will lead to increased shareholder value in Opta and we continue to assess options for the Opta business in the future."
