Rob McEwen To Increase Ownership to 12.3%
Quebec, June 3, 2016 AEST (ABN Newswire) - Abitibi Royalties Inc. (
CVE:RZZ) ("Abitibi Royalties" or the "Company") is pleased to announce that Rob McEwen, the Company's second largest shareholder, founder of Goldcorp Inc. and current Chairman/Chief Owner of McEwen Mining Inc. (NYSE:MUX), has agreed to purchase, indirectly, through a company wholly owned by him, 439,084 shares of the Company by way of a private transaction with certain directors of the Company for approximately CDN$2.3 million. The share purchases will increase Rob McEwen's ownership to 12.3% from 8.7% of the Company's outstanding shares and will build on an earlier CDN$2 million investment in 2014. In addition, the Company's president and CEO, Ian Ball, has agreed to purchase from a director of the Company 18,832 shares in the Company for approximately CDN$100,000 as he continues to invest the after tax portion of his salary in the shares of Abitibi Royalties.
The share purchases are being carried out pursuant to share purchase agreements with certain directors of the Company who have exercised stock options that are expiring in September 2016. The Company will receive approximately CDN$1.1 million from the proceeds of the exercise of stock options. The Company intends to use the majority of the proceeds from the stock option exercise to repurchase its shares under its Normal Course Issuer Bid (NCIB) currently in place. As part of the NCIB, Abitibi Royalties may enter into a pre-defined plan with its broker (TD Securities Inc.) to allow for the repurchase of shares at times when Abitibi Royalties ordinarily would not be active in the market due to its own internal trading blackout periods, insider trading rules or otherwise. Any such plans entered into with the Company's broker will be adopted in accordance with applicable Canadian securities laws.
In consideration of Mr. McEwen's investment, and for as long as the percentage of issued and outstanding shares of Abitibi beneficially owned by Mr. McEwen is at least 10%, the Company will support the nomination of one individual designated by Mr. McEwen for election or appointment to its board of directors.
"I would like to thank Rob for his continued support of Abitibi Royalties as we strive to become The Best Gold Company, which is focused on share price performance. It means a lot to me personally to have Rob double his initial investment from 2 years ago. This is a testament to all the great work done by the Company's employees, consultants and board of directors," stated Ian Ball, president and CEO.
About Abitibi Royalties Inc.
Abitibi Royalties Inc. (CVE:RZZ) holds a 3% NSR on the Odyssey North discovery, Jeffrey Zone and the eastern portion of the Barnat Extension, located inside the Malartic CHL property and a 2% NSR on portions of the Gouldie and Charlie zones, all at the Canadian Malartic mine near Val-d’Or, Québec. In addition, the Company is building a portfolio of royalties on early stage properties near producing mines. The Company owns common shares in Yamana Gold and Agnico Eagle Mines (market value), plus cash (as of September 30, 2016) of Cdn$41.8 million. The Company is debt free.
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