Augen Capital Corp. (TSXV:AUG) announced the amalgamation of the private company Nexxt Potash Inc., upon entering into a binding combination agreement to acquire 100% of the outstanding shares of Nexxt.
As quoted in the press release:
Pursuant to the Agreement, Nexxt will amalgamate with a wholly-owned subsidiary of Augen (“Subco“). On closing of the Transaction:
- each Nexxt share (other than Nexxt shares held by Augen’s subsidiary) outstanding immediately prior to closing shall be exchanged for one common share of Augen;
- each share of Subco outstanding immediately prior to closing shall be exchanged for one common share of the amalgamated company (“Amalco“);
- former Nexxt shareholders who exercise rights of dissent will be entitled to be paid the fair value of the Nexxt shares held by such dissenting shareholder in accordance with the provisions of section 190 of the Canada Business Corporations Act; and
- Amalco will be a wholly-owned subsidiary of Augen.
Nexxt has 21,412,500 shares outstanding and following closing, former shareholders of Nexxt will hold, in aggregate, approximately 20.6% of Augen’s outstanding shares.
Closing of the Transaction is subject to certain conditions including:
- approval by at least two-thirds of the votes cast by Nexxt shareholders at a meeting of Nexxt shareholders (anticipated to be held in early August, 2012);
- approval / acceptance of the TSX Venture Exchange;
- completion of due diligence, satisfactory to each of Nexxt and Augen, by July 31, 2012 (unless the parties agree to extend such deadline)
- Nexxt shareholders holding no more than 15% of the outstanding Nexxt shares having exercised dissent rights; and
- other conditions as are customary for transactions of this nature.
Alan Cruickshank, President and CEO of Augen commented:
The proposed acquisition of Nexxt represents a remarkable opportunity for us to leverage our combined potash experience. Stephen Halabura P.Geo. F.E.C. (Hon.), Nexxt’s co-founder, has extensive expertise in the potash industry and will remain Executive Chairman of Nexxt and be appointed to the board of Augen. Saskatchewan is one of the world’s primary basins for potash production. We anticipate more potash development regardless of the current supply situation.