Bakertalc, International Larder agree to amalgamate

Two companies active in the industrial minerals field, International Larder Minerals (TSE) and Bakertalc (TSE), have agreed to amalgamate. For Bakertalc, a talc producer, the amalgamation will provide access to International Larder’s talc reserves near Thetford Mines, Que., as well as talc mining and plant equipment.

For International Larder, the merger will supply a means to participate in talc production from Bakertalc’s operations at Highwater, Que.

To facilitate the amalgamation, River Oaks Gold, International Larder’s major shareholder, has agreed to provide a minimum of $1.75 million and a maximum of $2.25 million.

In exchange, River Oaks will receive one Larder unit consisting of a convertible fixed and floating debenture and warrants. Conversion of the debenture, at 15 cents per common share, would bring Larder’s total share issuance to 11.7 million. The warrants will give River Oaks the option to purchase an additional 11.7 million shares of Larder at 20 cents per share within a 5-year period.

The proceeds of the loan, $1.22 million of which will be advanced to Bakertalc, will be used to modernize Bakertalc’s operations, correct operating deficiencies and retire existing debt.

In return, Bakertalc will issue a unit comprised of a convertible fixed and floating debenture and warrants to Larder. If the debenture is converted at 10 cents per common share, Bakertalc’s share issuance will total 12.2 million. The warrants will give Larder the right to purchase an additional 12.2 million common shares of Bakertalc at 15 cents per share within a 5-year period.

If the amalgamation proceeds, the unit issued to Larder will be cancelled. The amalgamation is subject to regulatory, shareholder and board approval.