Denison Mines Corp. ("Denison") (TSX:DML)(NYSE MKT:DNN)(NYSE
Amex:DNN) and JNR Resources Inc. ("JNR") are pleased to announce
the signing of an acquisition agreement (the "Acquisition
Agreement") pursuant to which Denison will offer to acquire all of
the issued and outstanding common shares of JNR (the "JNR Shares")
by way of a friendly take-over bid (the "Offer"). Under the terms
of the Offer, JNR shareholders will receive 0.073 of a Denison
common share (a "Denison Share") for each JNR Share deposited under
the Offer, provided that no fractional Denison Shares will be
issued (the "Exchange Ratio"). The Offer represents a premium of
53% based on the 20-day volume weighted average share prices of
both companies on the TSX and the TSX-V as of November 13, 2012,
and a 55% premium to the closing prices immediately prior to
announcement. The Offer values JNR at approximately $10 million.
Upon completion of the transaction, shareholders of JNR will own
2.0% of Denison.
The board of directors of JNR, after consulting with its
financial and legal advisers, has unanimously approved entering
into the Acquisition Agreement and unanimously recommends that JNR
shareholders tender their shares pursuant to the Offer. JNR's board
of directors has received a fairness opinion from its financial
advisor that the consideration offered by Denison for the JNR
Shares under the Offer is fair, from a financial point of view, to
JNR shareholders. In addition, in conjunction with the Acquisition
Agreement, certain directors and officers of JNR are entering into
lock-up agreements with Denison, which together represents
approximately 4.5% of the issued and outstanding JNR Shares.
"We believe that the acquisition of JNR is a logical
consolidation step for Denison and advances our goal to become the
preeminent exploration company in the Athabasca Basin," commented
Lukas Lundin, Chairman of Denison.
"JNR is excited to combine with long-time multiple joint-venture
partner, Denison. We believe this transaction provides our
shareholders with excellent value for our current assets, along
with continued exposure to future exploration success," said Rick
Kusmirski, President & Director of JNR.
Transaction Benefits to JNR Shareholders
-- Substantial premium to JNR shareholders; above market, 53% premium to
JNR shareholders on a 20-day volume weighted average price basis as of
November 13, 2012
-- Denison is an established explorer and operator in the Athabasca Basin,
with a strong track record of success
-- Exploration synergies, including 6 current Joint Ventures with Denison
on properties in the Athabasca Basin
-- JNR shareholders to benefit from Denison's strong balance sheet, capital
market presence and the ability to fund future exploration programs
Transaction Summary
Denison expects to acquire JNR by way of a take-over bid whereby
Denison will offer to acquire all of the issued and outstanding JNR
Shares on the basis of 0.073 Denison Shares for each JNR Share
deposited under the Offer. As part of this transaction, Denison
also intends to offer replacement warrants and options to holders
of outstanding JNR warrants and options on similar terms as
adjusted by the Exchange Ratio.
The Acquisition Agreement provides for, among other things, a
non-solicitation covenant on the part of JNR, a right in favour of
Denison to match any superior proposal and a termination fee of
$325,000 payable to Denison in certain circumstances, including if
JNR accepts a superior proposal.
The Offer is expected to be made pursuant to a take-over bid
circular and related documents are to be mailed to JNR shareholders
in accordance with applicable laws (all subject to the terms and
conditions of the Acquisition Agreement). The Offer will be open
for acceptance for a period of not less than 35 days from its
commencement and may be extended from time to time. The Offer will
be subject to customary conditions, including, among other things,
at least two-thirds of the JNR Shares being deposited under the
Offer, receipt of requisite regulatory consents and the absence of
a material adverse change with respect to JNR.
Concurrently with the execution of the Acquisition Agreement,
Denison and JNR have entered into an unsecured loan agreement (the
"Loan Agreement") pursuant to which Denison will advance $350,000
(the "Principal") to JNR. The Principal shall be payable in full on
the termination of the Acquisition Agreement by either party
thereto for any reason at any time (the "Due Date"). Upon and after
the Due Date and until the Principal is repaid in full, interest
shall be calculated on the Principal outstanding at the rate of 5%
per annum.
Haywood Securities Inc. is acting as financial advisor to
Denison, while Toll Cross Securities Inc. is acting as financial
advisor to JNR. Cassels Brock & Blackwell LLP is acting as
legal advisor to Denison and Maitland & Co. is acting as legal
advisor to JNR.
This press release does not constitute an offer to buy or an
invitation to sell, or the solicitation of an offer to buy or
invitation to sell, any securities of Denison or JNR. Such an offer
may only be made pursuant to a take-over bid circular and related
documents filed with the securities regulatory authorities in
Canada. Denison intends to file a take-over bid circular with
Canadian provincial securities regulators. Denison also intends to
file with the U.S. Securities and Exchange Commission (the "SEC") a
Registration Statement on Form F-8 which will include the take-over
bid circular. Investors and security holders are urged to read the
take-over bid circular and related documents regarding the proposed
transaction referred to in these documents when they become
available, because they will contain important information.
Investors may obtain a free copy of the take-over bid circular,
when it becomes available, and other documents filed by Denison
with the Canadian provincial securities regulators on SEDAR at
www.sedar.com, and with the SEC at the SEC's website at
www.sec.gov. The take-over bid circular and related documents may
also be obtained for free, once they have been mailed, on Denison's
website. Free copies of any such documents could also be obtained
by directing a request to Denison at 595 Bay Street, Suite 402,
Toronto, Ontario, Canada, M5G 2C2.
Additional Information
Additional information about Denison is available on Denison's
website at www.denisonmines.com or under its profile on SEDAR at
www.sedar.com and on EDGAR at www.sec.gov.
About Denison
Denison Mines Corp. is a uranium exploration and development
company with interests in exploration and development projects in
Saskatchewan, Zambia and Mongolia. As well, Denison has a 22.5%
ownership interest in the McClean Lake uranium mill, located in
northern Saskatchewan, which is one of the world's largest uranium
processing facilities. Denison's exploration project portfolio
includes the world-class Phoenix deposit located on its 60% owned
Wheeler River project also in the Athabasca Basin region of
Saskatchewan.
Denison is engaged in mine decommissioning and environmental
services through its Denison Environmental Services (DES) division.
Denison is also the manager of Uranium Participation Corporation
(TSX:U), a publicly traded company which invests in uranium oxide
in concentrates and uranium hexafluoride.
Forward-Looking Statement
The preceding includes forward looking statements, including
statements regarding our ability to complete the Offer and the
repayment of the Principal under the Loan Agreement, which involves
known and unknown risks and uncertainties which may not prove to be
accurate. Actual results and outcomes may differ materially from
what is expressed or forecasted in these forward-looking
statements. Such statements are qualified in their entirety by the
inherent risks and uncertainties surrounding future expectations.
Among those factors which could cause actual results to differ
materially are the following: uncertainties as to the timing of the
Offer and satisfaction of the conditions thereto, market conditions
and other risk factors listed from time to time in our reports
filed with Canadian and U.S. securities regulators on SEDAR at
www.sedar.com and on EDGAR at www.sec.gov/edgar.shtml.
Contacts: Denison Mines Corp. Ron Hochstein President and Chief
Executive Officer (416) 979-1991, Extension 232 Denison Mines Corp.
James R. Anderson Executive Vice President and Chief Financial
Officer (416) 979-1991, Extension 372 www.denisonmines.com
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