New Global Ventures International Ltd.
TSX VENTURE : NNG

New Global Ventures International Ltd.

August 12, 2009 16:22 ET

New Global Ventures International Inc. Announces Terms of Transaction with Comanche Clean Energy Corporation

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Aug. 12, 2009) -

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES.

NEW GLOBAL VENTURES INTERNATIONAL LTD. (the "Corporation") (TSX VENTURE:NNG) is pleased to announce that further to its press release dated May 28, 2009, it has reached an agreement on August 2, 2009 respecting the fundamental terms of its proposed acquisition (the "Transaction") of substantially all of the issued and outstanding securities of Comanche Clean Energy Corporation ("Comanche").

Incorporated under the laws of the Cayman Islands in 2006, Comanche is a vertically-integrated producer of ethanol and biodiesel which started operating commercially in Brazil in 2007. Comanche owns and operates the Santa Anita and Canitar ethanol facilities (respectively located near the city of Tatui and the city of Ourinhos in the State of Sao Paolo) and the Bahia biodiesel facility (located in Simoes Filho in the State of Bahia), with a combined 270 million litre annual production capacity.

Terms of Acquisition

Pursuant to the agreement, subject to completion of satisfactory due diligence, a definitive purchase agreement and receipt of applicable regulatory approvals, the Corporation intends to acquire all of the issued and outstanding common shares of Comanche in consideration for approximately 351 million common shares of the Corporation at an estimated exchange ratio of 7.22 common shares of the Corporation for each common share of Comanche. The estimated exchange ratio is based on the relative valuations of the Corporation and Comanche as at the date of the agreement respecting the Transaction. It may be adjusted as a result of the due diligence investigations of both parties should the relative valuations differ at the time of closing. In addition, subject to regulatory approval, the Corporation would exchange all of the issued and outstanding options and common share purchase warrants of Comanche for 7.22 options and common share purchase warrants of the Corporation with substantially similar terms as those of the Comanche securities such that the holders of the securities of Comanche will neither benefit nor suffer for such exchange. The Transaction remains subject to regulatory, TSX Venture Exchange and shareholder approval.

The Corporation has agreed, prior to or concurrent with the completion of the Transaction, to divest the 333 uranium claims in Gila County, Arizona currently held by it.

The Transaction is an arm's length transaction. No insiders of the Corporation own securities in Comanche and no insiders of Comanche own securities in the Corporation.

Upon completion of the Transaction, the Corporation will continue to carry on the business of Comanche.

Comanche

Comanche, through its wholly-owned subsidiaries, produces renewable "green" chemicals, primarily clean fuel ethanol from sugarcane and biodiesel from multiple feedstocks, in facilities that it owns in Brazil. Comanche grows a substantial part of the sugarcane that is required for producing ethanol by its facilities or through partnerships and it purchases the balance of the required sugarcane from third parties. Comanche acquires feedstock for the production of biodiesel from third parties.

Sugarcane is considered one of the most efficient conversions of sunlight into energy by scientists and is a renewable resource. In addition, sugarcane converted into ethanol has a much more environmentally favourable set of attributes than corn ethanol: it provides at least seven times the energy output as used for energy input, it is not considered to be a competing food source use, it yields more than twice as much energy per acre, and it has three times greater reduction in greenhouse gas emissions from an overall use cycle standpoint.

To date, Comanche has increased its production capacity from zero to more than 270 million litres of biofuels. It has two ethanol production units with 170 million litres of capacity and one biodiesel unit with 100 million litres of capacity currently in operation. Comanche's ethanol operations consist of Santa Anita, a 600,000 ton sugarcane processing facility (approximately 50 million litres of ethanol capacity), and its Canitar facility, on which it recently spent approximately US$54 million to reconstruct a state-of-the-art new mill. The first phase of construction was completed in November 2008, resulting in approximately 1.2 million tons of crushing capacity per year, or 120 million litres of production on an annualized basis.

Along with these plants, Comanche has approximately 22,000 hectares of sugarcane feedstock under cultivation (on owned or leased land), in farmer partnerships or through suppliers. Comanche's Bahia biodiesel plant is water-based batch biodiesel processing facility with a 100 million litre capacity and it sources feedstock from third parties.

Comanche expects to continue to expand its biodiesel feedstock conversion capabilities, its product mix, its production facilities, and its sugarcane feedstock. It also intends to attract feedstock partnerships to facilitate the production of biodiesel.

Comanche's current customers for ethanol are fuel distributors and trading companies, and its current biodiesel sales are to Petrobras, a Brazilian oil company. Comanche expects to expand this group of customers to include additional domestic Brazilian and international relationships.

Since 2007, Comanche has raised close to US$200 million, and its key selected shareholders include funds managed by Goldman Sachs, Deutsche Bank AG, UBS AG, Gabelli Funds, Whitebox and MHR Advisors, which respectively hold in aggregate directly or through affiliated entities 3.2%, 15%, 3.2%, 0.6%, 25.2% and 1.4% of the common shares of Comanche, including those outstanding and the common shares issuable on the conversion of the outstanding preference shares. In 2007, Comanche had net sales of US$7.5 million and net sales of US$50.4 million in 2008 (figures derived from Comanche's audited financial statements).

Comanche currently has 30,479,206 common shares outstanding, 23,662 preference shares outstanding, which preference shares are mandatorily convertible into 18,140,866 common shares on the occurrence of the Transaction, and an aggregate of 2,605,289 common share purchase warrants outstanding. Thomas Cauchois, Chairman, and Alicia Noyola, Vice Chairman and Secretary, each owns 1,077,662 common shares of Comanche (representing an aggregate of 4.44% of the common shares of Comanche, including those outstanding and the common shares issuable on the conversion of outstanding preference shares).

Concurrent Financing

Simultaneously with the Transaction, the Corporation intends to complete a concurrent financing, the particulars of which will be announced in a subsequent press release once they have been determined.

Management and Board of Directors of the Resulting Issuer

Upon completion of the Transaction, it is anticipated that the Corporation's board of directors will consist of one current board member of the Corporation and four new board members. It is intended that the four new board members will be Thomas Chauchois, Alicia Navar Noyala, Mark Abrams and Farrer Pallin. It is also intended that Mark Lawson will resign as President of the Corporation, Len Davies will resign as Chief Financial Officer of the Corporation, and the proposed officers of the Corporation will be Thomas Cauchois as President and Chief Executive Officer, Aser Goncalves Junior as Chief Financial Officer, Alicia Noyola as Vice Chair and Secretary and Jose Augusto Bertoncini Goncalez as Vice President and Chief Operating Officer.

Thomas Cauchois, Proposed Chairman, President and Chief Executive Officer, 56. Mr. Cauchois is a founder of FondElec Capital Investors ("FondElecCI") and has spent 12 years investing in global emerging markets and twenty-two years in the global advisory and finance areas. FondElecCI is an emerging markets private equity investment firm. Affiliates of FondElecCI were early participants in investing in privatizations from Russia to Latin America and successfully exiting, and managing about $150 million in direct investment capital from a wide variety of institutions, corporations and governmental entities. Mr. Cauchois was on the Board of Cia Forca e Luz Cataguazes-Leopoldina in Brazil. Prior to founding affiliates of FondElecCI, Mr. Cauchois was a Managing Director at Drexel Burnham Lambert. Mr. Cauchois has an S.M. from the Sloan School of Management at the Massachusetts Institute of Technology and an A.B. from the University of California at Berkeley.

Alicia Navar Noyola, Proposed Vice Chairman and Secretary, 59. Mrs. Noyola's career has been centered on complex asset finance, including the energy and infrastructure sectors, working both in the U.S. and throughout Latin America. Prior to founding FondElecCI and having a management role with its affiliates, she was Vice President for Latin America Development for Calpine Corporation, an affiliate of Electrowatt Ltd., a Swiss multi-national, and earlier was a partner in the law firms of Thelen, Marrin, Johnson & Bridges and Lillick and Charles. Mrs. Noyola received her J.D. from Hastings College of the University of California, and a B.A. degree in architecture from the University of California, Berkeley.

Mark Abrams, Proposed Director, 55. Mr. Abrams' thirty year investment banking career includes his responsibilities as Deutsche Bank's Head of Brazil Investment Banking (1999 - 2001), Head of Brazil Corporate Finance for Bankers Trust (1990 - 1999), executive positions at Bear Stearns (1988 - 1990) and BankBoston where he began his career in the areas of Latin American Management Reporting and the Comptrollers Office. In 2001 Mr. Abrams formed the investment banking boutique, Integritas Partners, which merged with Stratus Investimentos, a Brazilian venture capital and advisory group in 2005. Currently Mr. Abrams is a senior advisor to Stratus and Sr. VP for International Development for Boys Hope Girls Hope, a St. Louis based NGO that assists academically capable and motivated children-in-need in the US and Latin America. Mr. Abrams is a resident of Brazil. Mr. Abrams earned his MBA, with Honors, from the Garvin School of Management - Thunderbird in 1976 and a BA in Economics from the University of Connecticut in 1975.

Farrer Jonathan Paul Lascelles Pallin, Proposed Director, 64. Mr. Pallin is a British chartered accountant, a Brazilian registered accountant and holds an MBA from the Cranfield Institute of Technology in England. In 2004 he retired from PricewaterhouseCoopers ("PwC") where he had been a partner in Brazil since 1977. Since then he has been a director of Companhia de Saneamento Basico do Estado de Sao Paulo - SABESP, where he set up and chaired the audit committee, and chairman of the fiscal councils of Arcelor Brasil S.A. and Companhia Siderurgica de Tubarao. He is currently chairman of the advisory council of the Hospital Samaritano. At PwC Mr. Pallin worked initially in the audit and then the management consultancy department; as the partner responsible for corporate finance and management consultancy he had also been a member of the Brazilian management team. From 1999 onwards as the partner responsible for operations ("COO") in South America, with responsibilities that included finance, infrastructure, technology and risk management, he was also a member of the South American leadership team. Throughout his career he has been deeply involved in advising multinational and national clients, in both private and public sectors, on M&A and corporate structuring, including various privatization programs. From 1991 to 2005 Mr. Pallin was also a director of the Hospital Samaritano, where he was chairman from 1995 to 1999. From 1992 to 1994 he was chairman of the British Chamber of Commerce & Industry in Brazil and the Council of European Chambers of Commerce in Sao Paulo.

Mark Lawson, Director, 37. Mr. Lawson has worked as an investment banker with Morgan Stanley in New York from 2005 until 2008 where he was involved in the execution of over $6 billion worth of mergers and acquisitions, $8 billion worth of debt offerings and $500 million of equity financings. Mr. Lawson was previously a Director of a boutique corporate finance firm in Toronto, Canada, from 2003 to 2004; and prior to that was a sales representative for AIM Funds in Toronto. He received his Bachelor of Arts in Statistical Sciences from The University of Western Ontario and his MBA from the Richard Ivey School of Business, University of Western Ontario. Mr. Lawson also serves on the boards of other reporting companies.

Aser Goncalves Junior, Proposed Chief Financial Officer, 37. Mr. Goncalves has an extensive experience in the financial area developed in large multinational corporations. He has worked for seven years for Pfizer in their operations in Brazil as an accounting manager, a risk assurance manager and Controller. At Pfizer, he achieved several goals and delivered excellence on planning, implementing and monitoring projects. Prior to that, he worked for five years at Sideco do Brasil Ltda (Argentinean multinational holding, investing in infrastructure) as a Financial and Administrative Manager and also as a Controller. Mr. Goncalves started his career at KMPG where he worked for five years. He holds a Bachelor in Business Administration from the Escola Superior de Administracao de Negocios and also a Bachelor in Accounting from the Universidade Paulista.

Jose Augusto Bertoncini Goncalez, Vice President and Chief Operating Officer, 45. Mr. Goncalez has a wide experience in the agricultural business both academically and professionally. He has an extensive academic background. He holds a degree in Agricultural Engineering from Faculdade de Agronomia e Zootecnia "Manoel Carlos Goncalves" and holds a BA in Business Administration from Faculdades Integradas de Ourinhos. Mr. Goncalez also holds an MBA in Business Management and a Masters in Communication from Universidade de Marilia. He worked at Cooperativa Agricola Mista of Colonia Riograndense and he worked for 12 years in the franchising business developing management, continuing education and organization plans. Mr. Goncalez has also taught classes as a university professor in a business administration and human resource organization.

Description of Significant Conditions to Closing

Completion of the Transaction is subject to a number of conditions including but not limited to, due diligence, TSX Venture Exchange acceptance (including satisfactory capital structure) and if required by TSX Venture Exchange policies, shareholder approval. Where applicable, the Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the Transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the disclosure documents to be prepared in connection with the Transaction, any information released or received with respect to the Transaction may not be accurate or complete and should not be relied upon.

The Corporation will make a subsequent news release with information on sponsorship, the concurrent financing and summary financial information in accordance with applicable TSX Venture Exchange policies.

ON BEHALF OF THE BOARD

Mark Lawson, President & CEO

Forward-Looking Statements

Certain information set forth in this press release, including management's assessment of future plans and operations, contains forward-looking statements. The use of any of the words "anticipate", "continue", "estimate", "expect", "may", "will", "project", "should", "believe" and similar expressions are intended to identify forward-looking statements. By their nature, forward-looking statements are subject to numerous risks and uncertainties, some of which are beyond management's control, including the impact of general economic conditions, industry conditions, volatility of commodity prices, currency fluctuations, imprecision of reserve or resource estimates, environmental risks, competition from other industry participants, the lack of availability of qualified personnel or management, stock market volatility and ability to access sufficient capital from internal and external sources. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements. Actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements. No assurance can be given that any of the events anticipated will transpire or occur, or if any of them do so, what benefits will derive from them. Except as required by applicable securities laws, the Corporation disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

The TSX Venture Exchange has in no way passed upon the merits of the Transaction and has neither approved or disapproved the contents of this press release. 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.

Contact Information

  • New Global Ventures International Ltd.
    Mark Lawson
    President & CEO
    416-623-0565
    or
    New Global Ventures International Ltd.
    Tyler Ross
    Corporate Development
    604-893-8838
    or
    New Global Ventures International Ltd.
    Jeremy Ross
    Corporate Development
    604-893-8838
    604-662-3904 (FAX)