TSC Capital Ltd.

December 21, 2010 15:02 ET

TSC Capital Announces Proposed Investment in MagIndustries Ltd.

TORONTO, ONTARIO--(Marketwire - Dec. 21, 2010) - TSC Capital Ltd. ("TSC") reports that it has entered into a letter of intent with MagIndustries Corp. ("MagIndustries" or the "Company") (TSX:MAA) in respect of a proposed investment by TSC in MagIndustries.

Pursuant to the letter of intent, TSC will conduct due diligence in respect of MagIndustries. Prior to signature of the letter of intent, TSC had not completed any substantial due diligence on the Company. Following completion of due diligence and provided that TSC is satisfied, in its sole discretion, with the results of such due diligence, TSC and the Company expect to enter into a subscription agreement pursuant to which TSC (or its nominee) will, subject to receipt of customary regulatory and other approvals as described in more detail below, agree to purchase, on an exempt private placement basis, 222.4 million units ("Units") issued by the Company at a price of Cdn$0.335 per Unit (the "Offering"). Each Unit will be comprised of one common share in the capital of the Company and one common share purchase warrant (a "Unit Warrant"). Each Unit Warrant will entitle the holder thereof to acquire one common share in the capital of the Company at an exercise price of Cdn$0.335 at any time until the first anniversary of the date of issue of the Unit Warrants (the "Unit Warrant Exercise Period"). As consideration for entering into the letter of intent, the Company has agreed to issue to TSC, 113,481,000 common share purchase warrants (the "Warrants"). Each Warrant entitles TSC to acquire one common share in the capital of the Company at an exercise price of Cdn$0.32 per common share at any time until the first anniversary of the date of granting of the Warrant. The issuance of the Warrants will be completed in conjunction with the issuance of one common share in the capital of the Company at a price of Cdn$0.32. If exercised in full, the common shares issuable to TSC pursuant to the Warrants would bring TSC's ownership of MagIndustries to approximately 19.9% of the issued and outstanding shares.

Provided that TSC is satisfied with its due diligence and that it signs definitive documentation to subscribe for the Units, if all of such Units are issued, and all of the Warrants and the Unit Warrants are exercised, TSC would have an ownership interest of approximately 55% of MagIndustries' issued and outstanding shares.

The completion of the Offering will be subject to receipt of all necessary regulatory approvals and the approval of the Company's shareholders to be obtained at a special meeting of the shareholders which the Company anticipates calling in the first quarter of 2011.

TSC has entered into the letter of intent and has acquired the Warrants and the associated common share for investment purposes. In addition, TSC may, following completion of its due diligence, participate in the Offering as contemplated in the Letter of Intent. TSC is now proceeding to conduct due diligence with respect to the Company and will make any further investment decisions in respect of the Company following completion of its due diligence. TSC may in the future take such actions in respect of its holdings of securities of the Company as it deems appropriate in light of circumstances then existing, including the acquisition or disposition of Common Shares or other securities of the Company. TSC may from time to time acquire Common Shares in the open market or in privately negotiated transactions, subject to availability of Common Shares at prices deemed favourable, the Company's business or financial condition and other factors and conditions TSC deems appropriate. In addition, the TSC may formulate other purposes, plans or proposals regarding the Issuer or any of its securities to the extent deemed advisable in light of general investment and trading policies, market conditions or other factors.

About TSC Capital Ltd.

TSC is a private investment partnership focused on the mining and natural resources sector. TSC and its partners have extensive investment and mining experience in Africa, Asia, and Europe, including leading roles in the development and operation of large scale mining projects. The firm invests in natural resource companies at all stages of development, bringing a broad range of operational and management competencies in addition to financial capital. TSC has particular expertise in Sub-Saharan Africa, the firm's area of historic focus. 

TSC's address is Coast Building, 2nd Floor, Wickham's Cay II, Road Town, Tortola, BVI. A copy of the early warning report to be filed by TSC under applicable Canadian securities laws in connection with the information in this press release may be obtained from Justin Chorn, Director of TSC at +44 (0) 7515 288 598.

The issuance of this news release is not an admission that an entity named in this news release owns or controls any described securities or is a joint actor with another named entity.

Contact Information

  • TSC Capital Ltd.
    Justin Chorn
    Director
    +44 (0) 7515 288 598