Mega Silver and Skybridge Development Corp Sign Business Combination Agreement
posted on Apr 21, 2009 06:11AM
Developing the Blue Caribou Project in Nunavut, Canada
|April 21, 2009|
|Mega Silver Inc. and Skybridge Development Corp. Sign Business Combination Agreement|
|TORONTO, ONTARIO--(Marketwire - April 21, 2009) - Mega Silver Inc. (TSX VENTURE:MSR) ("Mega") and Skybridge Development Corp. (TSX VENTURE:SBD) ("Skybridge") announce that they have signed a business combination agreement in respect of the previously announced proposed acquisition of Skybridge by Mega. Under the terms of the acquisition, Mega will acquire all of the outstanding common shares of Skybridge ("Skybridge Shares") in exchange for common shares of Mega ("Mega Shares"), on the basis of one (1) Mega Share for every two and one-half (2.5) Skybridge Shares outstanding (the "Exchange Ratio").
The acquisition is to be effected by way of a three-cornered amalgamation (the "Amalgamation"), whereby Skybridge will amalgamate with a wholly-owned subsidiary of Mega and the resulting corporation (which will be a wholly-owned subsidiary of Mega) will continue to carry on Skybridge's business. Shareholders of Skybridge will receive Mega Shares in exchange for the Skybridge Shares which they hold immediately prior to the effective date of the Amalgamation, on the basis of the Exchange Ratio (but subject to rounding in the event of fractional shares, which will not be issued).
Upon completion of the Amalgamation, all Skybridge Shares will be de-listed from the TSX Venture Exchange. Stock options and common share purchase warrants of Skybridge outstanding following completion of the Amalgamation will be adjusted to provide for the purchase of Mega Shares in lieu of Skybridge Shares (based upon the Exchange Ratio), upon the due exercise thereof.
Completion of the Amalgamation is subject to satisfaction of a number of conditions, including receipt of the approval of the the TSX Venture Exchange and the shareholders of Skybridge. A meeting of the shareholders of Skybridge is scheduled to be held on May 25, 2009 to consider and approve the Amalgamation (the "Skybridge Meeting").
Additional details of the proposed acquisition are provided in the management information circular of Skybridge in respect of the Skybridge Meeting, copies of which, together with related materials, will be mailed to registered shareholders on April 27, 2009.
Highlights of the proposed business combination include a change of senior management of the combined company. It is proposed that Mr. Jim Rogers will assume the role of President and CEO. Mr. Rogers was most recently Regional Exploration Manager for Goldcorp Inc. at Red Lake. Jim's background in the Red Lake gold camp will be a tremendous asset to the newly amalgamated company as it executes a mandate to explore and develop promising gold assets in the Red Lake camp.
A principal shareholder of Skybridge who holds an aggregate of 2,469,000 Skybridge Shares, representing approximately 12.2% of the Skybridge Shares outstanding as at March 31, 2009, has entered into a support agreement with Mega, whereby the shareholder has agreed, among other things, to vote their Skybridge Shares in favour of the Amalgamation at the Skybridge Meeting and to not take any action, directly or indirectly, which could reasonably be expected to affect the completion of the Amalgamation.
Research Capital Corporation has acted as financial advisor to Skybridge in respect of the transaction and has provided an opinion that the consideration to be paid to shareholders of Skybridge under the Amalgamation is fair from a financial point of view.
PowerOne Capital Markets Limited has acted as financial advisor to Mega in respect of the transaction.
Based upon the number of Skybridge Shares and Mega Shares outstanding as at April 9, 2009, if the acquisition is completed, Mega will issue approximately 8,105,588 Mega Shares (subject to rounding in the event of fractional interests) to the shareholders of Skybridge in exchange for their Skybridge Shares, representing approximately 23.1% of the number of Mega Shares then outstanding.
About Mega Silver
Mega is a public Canadian-based silver mineral exploration company with projects in the Yukon that is committed to an accelerated growth strategy. Backed by a team of experienced mining experts and a strong financial position, Mega Silver is well poised for rapid expansion through quick response to new opportunities and changes in the market. www.megasilver.ca.
Skybridge is a public Canadian-based mineral exploration and development company that recently completed a Phase 1 3600m drill program at its high grade copper Blue Caribou Project in Nunavut Territory, Canada. The Company recently announced its entry into the Red Lake gold camp and a strategy to consolidate other mineral assets Skybridge has an experienced management team to advance its business objective of building shareholder value through exploration and development of mineable mineral resources. www.skybridgedevelopment.com.