Molycorp buys NEO Material Technologies
Neo Material Technologies Inc (C-NEM) - News Release
Neo Material signs $1.3-billion acquisition by Molycorp
2012-03-08 18:17 ET - News Release
Shares issued 115,135,582
NEM Close 2012-03-07 C$ 8.00
Mr. Jim Sims of Molycorp reports
MOLYCORP TO ACQUIRE LEADING RARE EARTH PROCESSOR NEO MATERIAL TECHNOLOGIES IN $1.3 BILLION DEAL
Molycorp Inc. and Neo Material Technologies Inc. have signed a definitive agreement under which Molycorp will acquire Neo Materials for approximately $1.3-billion. This will create one of the most technologically advanced, vertically integrated rare earth companies in the world.
"This transaction will link two unique companies A one with a world-class, high-quality resource, and the other with world-class rare earth product design and processing capabilities," said Mark A. Smith, Molycorp's President and Chief Executive Officer. "Neo Materials is recognized throughout the industry for its exceptionally high-quality production and processing capabilities, its patented technology platform, and its ability to consistently meet demanding customer specifications. With this combination, Molycorp will be in a unique position to enhance our time to market and provide new global customer segments with rare earth metals, oxides, and alloy powders that are unmatched today. We see significant opportunities for growth as well as powerful synergies through this transaction."
TRANSACTION TERMS
Under the agreement, which was unanimously approved by the two companies' boards of directors, Neo Materials shareholders will receive consideration equal to CDN$11.30 per share, comprising of CDN$8.05 per share in cash and 0.122 Molycorp shares based on Molycorp's 20A day volume weighted average price of US$26.66. Neo Materials shareholders will have the right to elect their preferred consideration mix of cash and newly issued Molycorp common stock, with the total consideration being approximately 71.2 percent cash and approximately 28.8 percent Molycorp common stock. The CDN$11.30 per share represents a premium of approximately 42 percent to Neo Materials' closing share price of CDN$7.97 on March 8, 2012.