Bell Copper sale and Debt elimination
Bell Copper closes sale of La Balsa project, SXEW plant
2013-08-02 15:13 ET - News Release
Mr. Timothy Marsh reports
BELL COMPLETES SALE OF THE LA BALSA PROJECT & SXEW PLANT PROCEEDS TO ELIMINATE BANK DEBT
Further to Bell Copper Corp.'s news release dated July 9, 2013, Bell, along with its wholly owned subsidiaries, Rogue River Resources Corp. and Minera Montoro SA de CV, which held the La Balsa project in Mexico, have completed the share and asset sale and purchase agreement with Binhai Harbour Group HK Co. Ltd. and Jie Lu pursuant to which the purchasers purchased 100 per cent of the issued and outstanding shares of Montoro and Binhai purchased from Rogue River the SXEW plant owned by Rogue River that was being stored in Arizona.
The proceeds from the sale of Montoro and the SXEW plant, in the aggregate amount of $8-million (U.S.), were assigned to Macquarie Bank Ltd., which held security over Rogue River, Montoro, the La Balsa project and the SXEW plant for an amount exceeding the sale price ($9,157,332 as reported in the company's interim financial statements of March 31, 2013). Accordingly, neither Bell nor Rogue River retained any net proceeds from the sale. In addition to discharging its security and releasing Rogue River from all of its debt, Macquarie, as part of the transaction, terminated the 2-per-cent net smelter return royalty on the La Balsa project held by Macquarie and returned to Bell for cancellation 19,036,820 common shares of Bell held by Macquarie.
The sale transaction results in the elimination of all debt owed to Macquarie by Rogue River with a consequential reduction of debt on Bell's consolidated financial statements ($9,157,332 as reported in the company's interim financial statements of March 31, 2013). The cancellation of 19,036,820 common shares of Bell will reduce the number of shares issued and outstanding to 32,030,132 (on a postconsolidation basis).
Timothy Marsh, chief executive officer, commented: "Since we took over the management of Bell Copper in December of 2012 we have been focused on removing the barriers to building shareholder value. This elimination of over $9-million in secured debt from the company's consolidated balance sheet now positions the company for financing and for the reflection of value from its ownership of the Kabba project in Arizona, which historically has always been the main catalyst for building market value for the company."