In support of the acquisition, JMAC Resources has agreed to purchase 7,375,000 AMI common shares at a price of $0.20 per Share for gross proceeds of C$1,475,000 in a non-brokered private placement.
AMI Silica, a 50%-owned subsidiary of AMI, will complete the deal. The other half of AMI Silica is owned by JMAC Energy Services. Both JMAC Resources and JMAC Energy are controlled by Jon McCreary, a director of the corporation. Upon closing of the acquisition, each of AMI and Jon McCreary will hold an indirect 50% interest in the strategic assets.
AMI says the assets are comprised of real-estate, an operational sand mine and processing plant capable of up to two million tonnes production per year, fixed storage, two rail transloads (including unit-train capability) and mobile equipment.
The assets also include active supply chain contracts including rail cars, for cash consideration of US$1 million (approximately C$1.2 million) and the assumption of reclamation liabilities of approximately US$6.4 million.
The acquisition is expected to be a step forward for AMI Silica which is currently managing the assets under an operations agreement.
AMI CEO Robert Beekhuizen says: "This strategic acquisition is part of the corporation's planned growth and will expand AMI's portfolio to include both US and Canadian resources and assets and will bring a new source of revenue to AMI. We see this targeted acquisition as a strategic bookend complementing AMI's Prosvita Sand Project in Alberta. It has a proven supply chain with a history of product delivery to destinations across Alberta, British Columbia and select locations in the United States. We are very familiar with the assets being acquired, having had hands-on experience successfully managing and operating them for the past five months. We're fully staffed and ready for a smooth transition, and excited to on-board new team members to the AMI family. We also look forward to serving our customers and community stakeholders with excellence and integrity."
