Montreal, Québec--(Newsfile Corp. - December 5, 2023) - Vanstar Mining Resources Inc. (TSXV: VSR) (OTCQX: VMNGF) (FSE: 1V8) ("Vanstar", or the "Company") is pleased to announce that it has entered into a definitive arrangement agreement (the "Arrangement Agreement") with IAMGOLD Corporation (NYSE:IAG) (TSX:IMG) ("IAMGOLD"), pursuant to which IAMGOLD will, subject to the terms and conditions of the Arrangement Agreement, acquire all of the issued and outstanding common shares of Vanstar (each, a "Vanstar Share") by way of a court-approved plan of arrangement (the "Transaction").
Pursuant to the Transaction, Vanstar's shareholders will receive 0.2008 of an IAMGOLD common share (each whole common share of IAMGOLD, an "IAMGOLD Share") for each Vanstar Share. Based on the 5-day volume weighted average price ("VWAP") of the IAMGOLD Shares on the Toronto Stock Exchange (the "TSX") as of December 1, 2023 (the "IMG Share VWAP"), the consideration payable by IAMGOLD implies a value of C$0.69 (the "Consideration Value") for each Vanstar Share. In addition, each outstanding common share purchase option of Vanstar (a "Vanstar Option") will be cancelled in exchange for an amount equal to the amount, if any, by which C$0.69 exceeds the exercise price payable under such Vanstar Option by the holder thereof to acquire one Vanstar Share underlying such Vanstar Option, such amount to be paid 50% in cash and 50% in IAMGOLD Shares (with the value of each such IAMGOLD Share deemed to be equal to the IMG Share VWAP).
The total consideration payable by IAMGOLD based on the Consideration Value is approximately C$45 million on a fully diluted in-the-money basis. The Consideration Value represents a 74% premium to the 20-day VWAP of the Vanstar Shares on the TSX Venture Exchange ("TSXV") as of December 1, 2023.
JC St-Amour, President and CEO of Vanstar, commented: "This transaction provides a meaningful premium to our shareholders and the opportunity to continue to benefit as part of an established gold producer with a meaningful growth pipeline including participation in the ramp up of Côté Gold. Having considered the landscape, we are convinced that combining forces with IAMGOLD will unlock significant value for our shareholders. Today represents a significant milestone for all Vanstar stakeholders and I would like to thank them for their support over the years."
Transaction Overview
The Transaction will be carried out by way of a court-approved plan of arrangement under the provisions of the Canada Business Corporations Act. Completion of the Transaction is subject to approval by the Superior Court of Québec and will require approval by at least two-thirds (66⅔%) of the votes cast by Vanstar shareholders and more than 50% of the votes cast by disinterested Vanstar shareholders at a special meeting of Vanstar shareholders that is expected to be held in January 2024 (the "Meeting"). The approval of shareholders of IAMGOLD is not required in connection with the Transaction.
All of the directors and officers of Vanstar (holding in the aggregate approximately 8.3% of the issued and outstanding Vanstar Shares on a non-diluted basis) have entered into voting and support agreements pursuant to which they have agreed to vote their Vanstar Shares in favour of the Transaction.
In addition to shareholder and court approvals, the Transaction is subject to customary closing conditions, including the receipt of applicable regulatory approvals and third party consents as may be required to effect and complete the transaction, including approval of the TSX (in respect of IAMGOLD) and the TSXV (in respect of Vanstar). The Arrangement Agreement also provides for a payment of a $2 million termination fee payable to IAMGOLD in certain circumstances.
Assuming that all requisite approvals are received, IAMGOLD and Vanstar expect to close the proposed Transaction shortly after the date of the Meeting. Upon completion, all of the members of the board of directors of Vanstar (the "Vanstar Board") and each executive officer of Vanstar will resign and a new management team appointed by IAMGOLD will manage Vanstar after completion of the Transaction.
Further details of the Transaction will be included in the management information circular of Vanstar to be filed with regulatory authorities and mailed to Vanstar shareholders in accordance with applicable securities laws.
Vanstar security holders and other interested parties are advised to read the materials relating to the proposed Transaction, including the Arrangement Agreement that will be filed by Vanstar with securities regulatory authorities in Canada when they become available. Anyone may obtain copies of these documents when available free of charge on Vanstar's SEDAR+ profile at www.sedarplus.ca.
Vanstar Board of Directors Recommendation
The Vanstar Board unanimously approved the Transaction and recommends that Vanstar shareholders vote their Vanstar Shares in favour of the Transaction. Maxit Capital LP has provided a verbal opinion to the Vanstar Board to the effect that, based upon and subject to certain assumptions, limitations and qualifications, the consideration to be received pursuant to the Transaction is fair, from a financial point of view, to the Vanstar shareholders.
Advisors & Counsel
Maxit Capital LP is acting as financial advisor to Vanstar. McMillan LLP is acting as legal counsel to Vanstar in connection with the Transaction.
About IAMGOLD
IAMGOLD is an intermediate gold producer and developer based in Canada with operating mines in North America and West Africa. IAMGOLD is building the large-scale, long life Côté Gold project in Canada in partnership with Sumitomo Metal Mining Co. Ltd., which is expected to commence production in the first quarter of 2024. In addition, IAMGOLD has an established portfolio of early stage and advanced exploration projects within high potential mining districts in Canada. IAMGOLD employs approximately 3,600 people and is committed to maintaining its culture of accountable mining through high standards of Environmental, Social and Governance (ESG) practices, including its commitment to Zero Harm®, in every aspect of its business. IAMGOLD is listed on the New York Stock Exchange (NYSE:IAG) and the TSX (TSX:IMG) and is one of the companies on the Jantzi Social Index (JSI), a socially screened market capitalization-weighted consisting of companies which pass a set of broadly based environmental, social and governance rating criteria. IAMGOLD's head office is located at 401 Bay Street, Suite 3200, P.O. Box 153, Toronto, ON, CA, M5H 2Y4.
About Vanstar
Vanstar is a gold exploration company with properties located in Northern Québec at different stages of development. The Company owns a 25% interest in the Nelligan project (2.0 million indicated ounces and 3.6 million inferred ounces Au, NI 43-101 February 2023) and 1% net smelter return royalty. The Nelligan Project won the "Discovery of the Year" award at the 2019 Quebec Mineral Exploration Association Xplor Gala. Vanstar is also earning 75% into the Bousquet-Odyno project located along the Cadillac Break and owns 100% of the Felix property in the Chicobi Group (Abitibi mining camp, 65km East of Amex Perron property), the Amanda property, a 7,306 ha property located on the Auclair formation with historic gold showings up to 12.1 g/t Au over 3 meters, and the Frida and Eva properties located in the James Bay area.
Vanstar Contact Information:
JC St-Amour.
President and CEO
+1 (647) 296-9871
jc@vanstarmining.com
www.vanstarmining.com
Cautionary Statements
This announcement is for informational purposes only and does not constitute a solicitation or a proxy.
The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), or any state securities laws and may not be offered or sold within the United States or to, or for the account or the benefit of, U.S. persons (as defined in Regulation S under the U.S. Securities Act) unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Certain information in this news release is considered forward-looking within the meaning of certain securities laws and is subject to important risks, uncertainties and assumptions. This forward-looking information includes, among other things, information with respect to the Company's beliefs, plans, expectations, anticipations, estimates and intentions. The words "may", "could", "should", "would", "suspect", "outlook", "believe", "anticipate", "estimate", "expect", "intend", "plan", "target" and similar words and expressions are used to identify forward-looking information. The forward-looking information in this news release describes the Company's expectations as of the date of this news release. Forward-looking statements in this news release include, but are not limited to statements with respect to the anticipated timing for the Meeting and the closing of the Transaction, the anticipated consideration to be received by Vanstar shareholders and holders of Vanstar Options, the satisfaction of closing conditions including: (i) required Vanstar shareholder approval; (ii) necessary court approval in connection with the Transaction; (iii) certain termination rights available to the parties under the Arrangement Agreement; (iv) Vanstar obtaining the necessary approvals from the TSXV; and (v) other closing conditions, including, without limitation, the operation and performance of the Vanstar business in the ordinary course until the closing of the Transaction and compliance by Vanstar with various covenants contained in the Arrangement Agreement.
The results or events anticipated or predicted in such forward-looking information may differ materially from actual results or events. Material factors which could cause actual results or events to differ materially from such forward- looking information include, among others, risks arising from general economic conditions; adverse industry events; inability to realize anticipated synergies; future legislative and regulatory developments; inability to access sufficient capital from internal and external sources, and/or inability to access sufficient capital on favourable terms; income tax and regulatory matters; the ability of Vanstar and IAMGOLD to implement their business strategies; competition; currency and interest rate fluctuations and other risks. Readers are cautioned that the foregoing list is not exhaustive.
The Company cautions that the foregoing list of material factors is not exhaustive. When relying on the Company's forward-looking information to make decisions, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. The Company has assumed a certain progression, which may not be realized. It has also assumed that the material factors referred to in the previous paragraph will not cause such forward-looking information to differ materially from actual results or events. However, the list of these factors is not exhaustive and is subject to change and there can be no assurance that such assumptions will reflect the actual outcome of such items or factors.
THE FORWARD-LOOKING INFORMATION CONTAINED IN THIS NEWS RELEASE REPRESENTS THE EXPECTATIONS OF THE COMPANY AS OF THE DATE OF THIS NEWS RELEASE AND, ACCORDINGLY, IS SUBJECT TO CHANGE AFTER SUCH DATE. READERS SHOULD NOT PLACE UNDUE IMPORTANCE ON FORWARD-LOOKING INFORMATION AND SHOULD NOT RELY UPON THIS INFORMATION AS OF ANY OTHER DATE. WHILE THE COMPANY MAY ELECT TO, IT DOES NOT UNDERTAKE TO UPDATE THIS INFORMATION AT ANY PARTICULAR TIME.
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