CALGARY, March 20, 2013 /CNW/ - NewNorth Projects Ltd. ("NewNorth" or the "Corporation") (TSX VENTURE: NNP) is pleased to provide the following operational and corporate updates in respect of the Corporation's assets and its future operational plans.
On March 1, 2013, the Corporation closed a previously announced purchase and sale transaction with an arm's length party in respect of the disposition of its 185 acre wholly-owned country residential development property near Cochrane, Alberta, for net proceeds of approximately $1.9 million.
The Corporation currently holds a 50% interest in the Riviera Suites Hotel Limited Partnership (the "RSHLP"). The RSHLP holds commercial land in downtown Fort McMurray, Alberta. The Corporation entered into a conditional purchase and sale agreement with an arm's length party to dispose of its 50% interest in the RSHLP (the "Fort McMurray Transaction"). The Fort McMurray Transaction is expected to close in the first half of 2013 with expected gross proceeds of approximately $5 million ($2.5 million net) less applicable realtor fees.
The Corporation recently announced that it had entered into a purchase and sale agreement (the "Agreement") with an arm's length party for the sale of its interest in the Kinniburgh South Limited Partnership (the "Partnership") that holds development property near Chestermere, Alberta, for gross proceeds of $3.5 million (the "Chestermere Transaction"). The Agreement was amended on March 14, 2013, whereby the purchaser waived its conditions and the closing date of the Agreement was amended to on or about April 30, 2013. The Chestermere Transaction remains subject to various conditions including but not limited to receiving the approval of the Corporation's shareholders ("Shareholders"), the other limited partner of the Partnership and the TSX Venture Exchange ("TSXV"). The board of directors of the Corporation (the "Board") has decided to hold a special meeting of Shareholders on or about April 30, 2013 whereat the Corporation will seek approval for the Chestermere Transaction. Notice of the special meeting and accompanying management information circular will be provided to Shareholders in due course in accordance with applicable laws.
Assuming completion of both the Fort McMurray Transaction and the Chestermere Transaction, the Corporation's remaining operational asset will be its 50% interest in a 408 acre development project adjacent to Okotoks, Alberta (the "Sandstone Asset").
NewNorth's Future Operational Plans
Assuming completion of the Fort McMurray Transaction and the Chestermere Transaction, the Corporation will hold approximately $6.8 million in cash as well as its interest in the Sandstone Asset. Given the nature of the market in which the Corporation operates and the opportunities currently available to the Corporation, the Board has determined that it is in the best interests of the Corporation to seek offers and alternatives in disposing of its interest in the Sandstone Asset.
The Corporation has provided working termination notices to certain of its staff and will be continuing to minimize its general and administrative costs on a going forward basis.
Cautionary Note Regarding Forward-Looking Statements
Except for the statements of historical fact contained herein, certain information presented herein constitutes "forward-looking statements". More particularly, this press release contains statements concerning the sale of the Fort McMurray Transaction, the Chestermere Transaction, the future disposition of the Sandstone Asset, the timing of the special meeting of Shareholders, certain conditions surrounding such transactions and the future operational plans of the Corporation. The forward-looking statements contained in this document are solely opinions and forecasts which are uncertain and subject to risks. Forward-looking statements include but are not limited to uncertainties and other factors which may cause the actual results, performance or achievements of the Corporation to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to a number of known and unknown risks and uncertainties. Accordingly, readers are cautioned that the assumption used in the preparation of the forward-looking statements, although considered reasonable at the time of preparation may prove to be imprecise and, as such undue reliance should not be placed on forward-looking statements.
The forward-looking statements contained in this press release are made as of the date of this press release. Except as required by law, the Corporation disclaims any intention and assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable securities law. Additionally, the Corporation undertakes no obligation to comment on the expectations of, or statements made, by third parties in respect of the matters discussed above.
Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.
SOURCE: NewNorth Projects Ltd.
For further information:
For additional information, please contact Mr. Greg N. Herndier, President and Chief Executive Officer or Mrs. Shannon Cook, Controller at (403) 531-0280.