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TORONTO, Sept. 5, 2014 /CNW/ - (TSX:SCP) – Sprott Resource Corp. ("SRC") is pleased to announce that it intends to commence a normal course issuer bid (the "Bid") to repurchase up to 8.5 million of its common shares (the "Shares"), representing approximately 8.83% of the public float of SRC and approximately 8.66% of the total number of issued and outstanding Shares. As at August 29, 2014, there were 98,134,103 Shares of SRC outstanding. Purchases will be made for cancellation through the facilities of the Toronto Stock Exchange (the "TSX") or other Canadian market places at the prevailing market price of the Shares.
SRC has received approval from the TSX to commence the Bid on September 10, 2014. The Bid will end on the earlier of (i) September 9, 2015, (ii) when the number of common shares sought under the Bid have been obtained, and (iii) when notice is given by SRC to the TSX terminating the Bid if SRC determines that it is appropriate to do so. Pursuant to TSX policies, daily purchases made by SRC may not exceed 30,071 Shares, being 25% of the six-month average daily trading volume of 120,282 Shares on the TSX, subject to certain prescribed TSX exceptions including the "block purchase exemption".
SRC believes that its Shares have been trading in a price range that does not adequately reflect the value of the Shares in relation to SRC's assets and future prospects. As a result, SRC believes that, at appropriate times, repurchases through the Bid can enhance shareholder value and represents an attractive investment and an appropriate use of SRC's financial resources.
To the knowledge of SRC, no director or senior officer, no person acting jointly or in concert with SRC and no person holding 10% or more of any Shares of SRC currently intends to sell Shares during the course of the Bid. However, sales by such persons through the facilities of the TSX may occur if the personal circumstances of any such person changes or any such person makes a decision unrelated to the Bid. The benefits to any such person whose Shares are purchased would be the same as the benefits available to all other holders whose Shares are purchased under the Bid. SRC has purchased 1,584,994 Shares pursuant to a normal course issuer bid during the preceding 12 months at an average cost of $2.73 per Share.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of the securities in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful.
About Sprott Resource Corp.
Sprott Resource Corp. (TSX: SCP) is a resource-focused private equity investor managed by one of Canada's leading teams of resource private equity specialists. The company currently has investments in oil and gas, mining, agriculture and agricultural nutrients. SRC takes an active involvement in the companies in which it invests. Management is dedicated to generating consistently superior returns on capital for its shareholders, while focusing on risk management and real wealth preservation. To learn more, please visit www.sprottresource.com.
Certain statements in this news release contain forward-looking information (collectively referred to herein as the "Forward-Looking Statements") within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "may", "will", "project", "should", "believe", "plans", "intends" and similar expressions are intended to identify Forward-Looking Statements. In particular, but without limiting the forgoing, this news release contains Forward-Looking Statements pertaining to SRC's Bid. Although SRC believes that the Forward-Looking Statements are reasonable, they are not guarantees of future results, performance or achievements. A number of factors or assumptions have been used to develop the Forward-Looking Statements, including that SRC will be able to participate in the Bid. Actual results, performance or achievements could vary materially from those expressed or implied by the Forward-Looking Statements should assumptions underlying the Forward-Looking Statements prove incorrect or should one or more risks or other factors materialize, including (i) market volatility; (ii) the ability of SRC to repurchase its securities will be limited by applicable corporate law; and (iii) those risks described under the heading "Risk Factors" in SRC's annual information form dated March 25, 2014. The Forward-Looking Statements speak only as of the date hereof, unless otherwise specifically noted, and SRC does not assume any obligation to publicly update any Forward-Looking Statements, whether as a result of new information, future events or otherwise, except as may be expressly required by applicable Canadian securities laws.
SOURCE: Sprott Resource Corp.
For further information: Glen Williams, Director of Communications, T: (416) 943-4394, E: [email protected]