DGM Minerals Corp.

November 05, 2013 14:09 ET

DGM Minerals Corp. Announces LOI for Option to Acquire Central European Self-Storage Assets

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Nov. 5, 2013) - DGM Minerals Corp. ("DGM" or the "Company") (TSX VENTURE:DGM) announced today that it has executed a letter of intent (the "LOI") with Mr. Guy Pinsent under which the Company will acquire 100% of Mr. Pinsent's right to purchase certain self-storage assets in the Czech Republic and Poland (the "Assets").

Among the Assets are five self-storage stores, two located in Warsaw and three located in Prague. In the case of four of the five stores, DGM would also be purchasing the attached real estate. The purchase would make DGM the largest self-storage chain in Central Europe, which is a region management believes is poised for enormous short and long-term growth in the self-storage sector.

Option to Acquire Central European Self-Storage Assets

Mr. Pinsent secured the right to purchase the Assets pursuant to a letter agreement dated as of October 29, 2013. Under the letter agreement, Mr. Pinsent, with other purchasing principals including Mr. William Palmer and Mr. Roger Orf, has the right to purchase the Assets for a purchase price of 14,000,000 Euros.

Under the LOI, Mr. Pinsent has agreed to assign the right to purchase the Assets to DGM, subject to DGM, Pinsent and the vendor entering into a definitive agreement for the purchase of the Assets. In addition to acquiring the option to purchase the Assets, DGM shall also acquire other assets that Pinsent has obtained or developed with respect to his acquisition of the Assets, such as certain intellectual property respecting the business to be conducted following the successful acquisition of the Assets. The transaction, which will be a change of business for the Company, will be subject to the review and approval of the TSX Venture Exchange.

Under the LOI, DGM's acquisition of the Assets is conditional on, among other things: DGM completing a stock consolidation at a ratio to be determined prior to execution of the definitive agreement; DGM successfully completing an equity financing under which it raises no less than $15,000,000; DGM completing a name change; and completion of the transaction under the terms, conditions and timelines as stipulated in the letter agreement. The LOI is non-binding, and DGM's interest in the transaction is subject to DGM entering into a definitive agreement with Mr. Pinsent and the vendor.

As consideration for obtaining the option to purchase the Assets and these other assets developed by Mr. Pinsent, the LOI contemplates the issuance of what amounts to approximately 20% of the common shares of the company post-consolidation and post-financing, to Mr. Pinsent's group, which group includes at least Guy Pinsent, William Palmer, Roger Orf and Peter Smith, who is a minority partner in Mr. Pinsent's Group and is also President, CEO and a director of DGM. In addition, it is expected that each of Mr. Pinsent, Mr. Palmer and Mr. Orf will join DGM's board post-closing, bringing their European business experience to DGM's board.

Guy Pinsent is an entrepreneur with a background in investment banking (Citibank London, branded consumer team with clients including Bacardi, Diageo and British American Tobacco), the British Foreign Service and real estate investment and development. Mr. Pinsent was formerly a partner at Personal Storage, a private British self-storage business, at the time the sixth largest in the UK, before focussing on the self-storage opportunity in Poland and neighboring markets. Mr. Pinsent's real estate experience includes head of business development at Colliers International Poland, and consulting to a wide range or investors and developers. Mr. Pinsent assisted on the financing, development and sale of Helical Poland's 'Europa Centralna' retail park, an investment of EUR 115 million delivering 720,000 square feet of retail space (Phase 1), one of the largest retail developments in Europe. Mr. Pinsent was educated at Eton College and Cambridge University (Economics MA), lives in Warsaw and speaks fluent Polish.

William Palmer is an internationally recognized entrepreneur, operating executive and real estate professional. He was a pioneering developer of the European self-storage sector. Moving to London from California in 1986, Mr.Palmer was the founder and CEO of Access Storage, still, one of Europe's largest self-storage companies. In 1998 the company was sold to a $1.5 billion European fund sponsored by Security Capital. Mr.Palmer remained as CEO until 2000. At his departure, the company had 65 stores in the UK, France and Germany, and an estimated market capitalization of $350 million. With 3.5 million square feet of storage space Access was the largest self-storage operation in Europe. Mr.Palmer has over 30 years' real estate experience, including retail, industrial and office, and is also an investor and executive in several companies including technology, equipment rental and real estate. Mr. Palmer has an undergraduate degree from Yale University in Applied Mathematics and an MBA from Harvard Business School.

Roger Orf is a partner and head of Apollo Global Management's real estate business in Europe. Mr. Orf has been an active investor in Central and Eastern Europe including Poland. Prior to joining Apollo in 2010, Mr. Orf spent the majority of his career investing in the European real estate markets on behalf of Citigroup, Lone Star, for his own account and at Goldman Sachs. In his last four years at Goldman Sachs, Mr. Orf headed the European Real Estate Department and was a member of the European Investment Banking Operating Committee. Mr. Orf is a Founder of E-Shelter GmbH, a German based data centre business. He is a member of the University Of Chicago Graduate School Of Business Global Advisory Board and the Visiting Committee for the University of Chicago Law School. Mr. Orf holds J.D. and M.B.A. degrees from the University of Chicago, as well as an Economics BA (magna cum laude) and Phi Beta Kappa from Georgetown University.

The current President and CEO of DGM, Peter Smith, expressed a great deal of enthusiasm for the prospective deal. "We've been looking for an opportunity for DGM over the past few months and management feels that this potential transaction has outstanding potential, both because of the growth opportunity for self-storage in Central and Eastern Europe and due to the very high quality and relevant experience of the proposed additions to the board and management on consummation of the deal. However, there is a lot of work to be done between now, signing of a definitive agreement and the closing of the transaction. Management will continue to update the market as we progress."

About the Company

DGM Minerals Corp. is a Vancouver-based company and has its common shares listed on the TSX Venture Exchange. For further information, please refer to the Company's filings on SEDAR (www.sedar.com) or contact the Company by telephone at 778.999.7030.


Peter Smith, President and CEO

This update contains "forward-looking information" that is based on the Company's current expectations, estimates, forecasts and projections. This forward-looking information includes, among other things, the Company's business, plans, outlook and business strategy. The words "may", "would", "could", "should", "will", "likely", "expect," "anticipate," "intend", "estimate", "plan", "forecast", "project" and "believe" or other similar words and phrases are intended to identify forward-looking information.

Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the Company's actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking information. Such factors include, but are not limited to: uncertainties related to the ability of the Company to obtain or maintain an interest in a suitable business, property or properties, changes in economic conditions or financial markets; changes in prices for the Company's products or increases in costs; litigation, legislative, environmental and other judicial, regulatory, political and competitive developments; technological or operational difficulties; and labour relations matters.

This list is not exhaustive of the factors that may affect our forward-looking information. These and other factors should be considered carefully and readers should not place undue reliance on such forward-looking information. Except as required by law, the Company disclaims any intention or obligation to update or revise forward-looking information, whether as a result of new information, future events or otherwise.


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