REG - Gensource Potash - Agreement to Acquire Innovare Technologies Ltd.

Gensource PotashAnnouncement

13/04/2022 07:00

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RNS Number : 2416I  Gensource Potash Corporation  13 April 2022

 

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Gensource Announces Agreement to Acquire Innovare Technologies Ltd.

SASKATOON, Saskatchewan and London, U.K. April 13, 2022 - Gensource Potash
Corporation ("Gensource" or the "Company") (TSXV: GSP, AIM: GSP), a fertilizer
development company focused on sustainable potash production, is pleased to
announce it has reached a binding agreement (the "Agreement") to acquire 100%
of the issued and outstanding shares of Innovare Technologies Ltd.
("Innovare"), a privately-held developer of patented selective solution mining
and brine processing technology for the recovery of potash and other soluble
minerals. Gensource's acquisition of Innovare's shares will occur by way of a
reorganization whereby Innovare's existing shareholders will transfer the
shares they hold in Innovare to Gensource in exchange for new common shares of
Gensource ("Common Shares"). Following completion of the reorganization,
Innovare will exist as a wholly-owned subsidiary of Gensource and Innovare's
business will be integrated with and controlled by Gensource.

 

"Gensource's acquisition of Innovare's shares and the integration of
Innovare's business with our own will provide Gensource with exclusive use and
control of Innovare's unique and highly sought-after selective solution mining
and brine processing technology for potash development, without which the
environmental benefits of modern potash production would be extremely
challenging to replicate",  said Mike Ferguson, Gensource's President &
CEO. "The acquisition will place the Company in a strong competitive position
in an industry dominated by producing facilities based on conventional 1950s
and older technology.  With Innovare's technology integrated into our
business, we will have total control over production processes at the Tugaske
Project and future projects we anticipate rolling out in Saskatchewan and
globally, while also anticipating a reduction in life of mine costs.
Gensource looks to the future and continues to lead the way in responsible
potash production for a sustainable future. Gensource has had a long standing
relationship with Innovare.  Its technology is cutting edge and Innovare's
principals are considered by the industry as global experts in the field.
This transaction will strengthen Gensource's differentiated market position as
a near term potash  producer into a market that continues to see global
supply challenges and is in need of a structural change if we are to support
the world's growing agricultural requirement for environmentally sustainable
potash."

 

Gensource has worked with Innovare over the last six years in the development
of Gensource's modular potash production module.  The Company's potash
project located near Tugaske, Saskatchewan (the "Tugaske Project") will be the
first project to implement a Gensource module.

 

Innovare's technology contributes industry-proven techniques and new,
innovative and patented technology that de-risks selective extraction and is
expected to lower capital and operating costs for the Tugaske Project and
beyond.  By bringing this technology in-house, Gensource will control the
intellectual property that allows it to implement its strategic business plan,
which management of Gensource believes will be the future of potash
production.

 

The closing of the transaction values Innovare at approximately US$11.5
million, which represents the current value of existing licensing agreements
between the Company and Innovare. The Agreement remains subject to
satisfaction of certain conditions precedent, including the approval of the
TSX Venture Exchange, and is anticipated to close in Q2 2022.

 

The new Common Shares, to be issued upon close, will be issued at a price
equal to the price of the Common Shares issued during the next qualifying
equity fundraising of the Company, and will be subject to certain tranched
disposal restrictions until the Company reaches first production. The former
owners of Innovare include the corporate vehicles of the three principals,
being Artisan Consulting Services Ltd, McEwan Consulting Chemical Engineering,
Inc. and Ristra Consulting Inc.  For the year ended December 31, 2021,
Innovare reported an unaudited loss before tax of C$40,139 and gross assets of
C$12,025.

 

 

About Innovare

Innovare Technologies Ltd. specializes in drilling, solution mining and
processing technologies for potash and other soluble mineral mining projects.
The three principals of Innovare have a combined 100+ years' industry-specific
experience and have successfully developed potash projects in Saskatchewan,
including being part of the Potash One Inc. development of its Legacy Project,
which was purchased by K+S AG and has now been constructed and is in operation
as the Bethune Mine north of Moose Jaw, Saskatchewan.

 

For further information on Gensource, please contact:

 

 Gensource Potash Corporation
 Mike Ferguson - President & CEO                             +1-306-974-6414

 Strand Hanson Limited (Nominated & Financial Adviser)       +44 (0) 20 7409 3494
 Ritchie Balmer / Rory Murphy / Charles Hammond

 Peel Hunt LLP (Broker)                                      +44 (0) 20 7418 8900
 Ross Allister / David McKeown / Georgia Langoulant

 Camarco (Financial PR)                                      +44 (0) 20 3757 4997
 Gordon Poole / Charlotte Hollinshead / Lily Pettifar

 

For any press enquiries please contact us on gensource@camarco.co.uk

 

Further information on Gensource Potash Corporation can be found at
www.gensourcepotash.ca

Follow us on twitter @GensourcePotash

 

This announcement contains inside information for the purposes of Article 7 of
the Market Abuse  Regulation (EU) 596/2014 as it forms part of UK domestic
law by virtue of the European Union  (Withdrawal) Act 2018 ("MAR") and is
disclosed in accordance with the Company's obligations under Article 17 of
MAR.

 

About Gensource

Gensource is a fertilizer development company based in Saskatoon, Saskatchewan
and is on track to become the next fertilizer production company in that
province. With a modular and environmentally leading approach to potash
production, Gensource believes its technical and business model will be the
future of the industry. Gensource operates under a business plan that has two
key components: (1) vertical integration with the market to ensure that all
production capacity built is directed, and pre-sold, to a specific market,
eliminating market-side risk; and (2) technical innovation which will allow
for a small and economic potash production facility, that demonstrates
environmental leadership within the industry, producing no salt tailings,
therefore eliminating decommissioning risk, and requiring no surface brine
ponds, thereby removing the single largest and negative environmental aspect
of potash mining.

 

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that
term is defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.

 

Caution Regarding Forward-Looking Statement

This news release may contain forward looking information and Gensource
cautions readers that forward- looking information is based on certain
assumptions and risk factors that could cause actual results to differ
materially from the expectations of Gensource included in this news release.
This news release includes certain "forward-looking statements", which often,
but not always, can be identified by the use of words such as "believes",
"anticipates", "expects", "estimates", "may", "could", "would", "will", or
"plan". These statements are based on information currently available to
Gensource and Gensource provides no assurance that actual results will meet
management's expectations.

Forward looking statements include estimates and statements with respect to
Gensource's acquisition of Innovare, the integration of Innovare's business
with that of Gensource, the impact of the acquisition of Innovare and
Gensource's future plans, objectives or goals, to the effect that Gensource or
management expects a stated condition or result to occur, including the
acquisition of Innovare and related matters and any offering of securities by
Gensource. Since forward-looking statements are based on assumptions and
address future events and conditions, by their very nature they involve
inherent risks and uncertainties. Actual results could differ materially from
those currently anticipated in such statements for many reasons such as:
failure to complete the acquisition of Innovare; failure to complete an
offering of securities; failure to finance the Project or other projects on
terms which are economic or at all; failure to settle a definitive joint
venture agreement with a party and advance and finance the Tugaske Project;
changes in general economic conditions and conditions in the financial
markets; the ability to find and source off-take agreements; changes in demand
and prices for potash; litigation, legislative, environmental and other
judicial, regulatory, political and competitive developments; technological
and operational difficulties encountered in connection with Gensource's
activities; an inability to predict and counteract the effects of COVID-19 on
the business of Gensource, including but not limited to the effects of
COVID-19 on the price of commodities, capital market conditions, restriction
on labour and international travel and supply chains, failure to obtain
required regulatory approvals; and other matters discussed in this news
release and in filings made with securities regulators. This list is not
exhaustive of the factors that may affect any of Gensource's forward-looking
statements. These and other factors should be considered carefully, and
readers should not place undue reliance on Gensource's forward-looking
statements. Gensource does not undertake to update any forward-looking
statement that may be made from time to time by Gensource or on its behalf,
except in accordance with applicable securities laws.

 

 

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