Aberdeen International Inc has agreed to sell some of its public and private holdings to Landmark. The approximate price of the transaction, which is expected to be completed on or before August 31, 2015, is $11.8 million. At the closing of the deal, Aberdeen will receive about $8.1 million in proceeds. Sixpoint Partners LLC is advising Aberdeen on the sale.
TORONTO, ONTARIO–(Marketwired – Aug. 13, 2015) – ABERDEEN INTERNATIONAL INC. (“Aberdeen”, or the “Company”) (TSX:AAB) has entered into an agreement to sell certain public and private equity holdings to Ore Acquisition Partners, LP, an investment vehicle owned by funds managed by Landmark Equity Advisors, LLC (“Landmark”). As part of the transaction, Aberdeen will also transfer its shares in Tahoe Resources to the partnership, with payment for those shares being deferred until such shares are sold.
Terms of the Transaction
Aberdeen is selling a portfolio of public and private holdings owned prior to September 2014 for an aggregate price of approximately $11.8 million to Ore Acquisition Partners L.P.
On closing, Aberdeen will receive gross proceeds of approximately $8.1 million.
Included in the sale are 325,000 shares of Tahoe Resources, for which payment will be deferred until the entire Tahoe position is sold. The deferred payment to Aberdeen will be equal to the net proceeds received from the future sales of these Tahoe shares.
As part of the terms of the sale, Aberdeen has the right to an additional $2,000,000 earn out, which is payable upon achievement of certain milestones.
Aberdeen will provide management and administrative services to the partnership for a minimum of three and up to five years and will receive a management fee in addition to a small minority interest in the net profits of the partnership.
Aberdeen will retain a number of significant recent investments, including its 44% interest in African Thunder Platinum with a book value of $10.3 million and a portfolio of several smaller publicly traded holdings with a current market value of approximately $3.2 million. Aberdeen intends to use substantially all of the net proceeds from the Landmark sale for future investments in pre-IPO and/or public resource companies and/or projects with undervalued high quality resources, in keeping with the current business model of Aberdeen.
Going forward the Aberdeen portfolio will consist largely of cash and holdings in acquisitions made since the Letter of Intent (“LOI”) was announced in September 2014, including its stake in African Thunder Platinum. The terms of the deal remain largely consistent with the original $29 million LOI announced, however over the past year Aberdeen has sold most of its position in Tahoe Resources (which was included in that original LOI) to fund new investments (as noted above) and other corporate activities.
David Stein, President and CEO of Aberdeen, stated, “We have been patiently working on this transaction for the past year, and have felt throughout the process it was an important strategic move to unlock value in our illiquid historical portfolio and allow Aberdeen to continue to take advantage of newly created opportunities in the mining sector. We look forward to growing a strong partnership with Landmark over the coming years. We believe the strength of our recent investments will continue to generate upside for Aberdeen shareholders and are excited with the prospects of deploying the cash proceeds for future opportunities. Over the past year we have seen the financial health of the mining sector worsen. As a result, we believe we can acquire controlling interests in projects which are currently undervalued in order to generate significant long-term returns for our shareholders, and capitalize on the strong track record of our team investing in the mining industry.”
It is anticipated that closing of the transaction will occur on or before August 31, 2015. Closing of the transaction is subject to receipt of all regulatory approvals, including that of the Toronto Stock Exchange, and such other conditions as may be imposed by the TSX. Aberdeen has engaged Sixpoint Partners LLC to act as strategic advisors with respect to the proposed transaction. Landmark is being represented in the transaction by legal counsel from Kirkland & Ellis LLP and from Osler Hoskin & Harcourt LLP. Aberdeen is being represented in this transaction by legal counsel from Cassels Brock and Blackwell LLP.
About Aberdeen International Inc:
Aberdeen is a publicly traded global investment and merchant banking company focused on small cap companies in the resource sector. Aberdeen will seek to acquire significant equity participation in pre-IPO and/or early stage public resource companies with undeveloped or undervalued high-quality resources. Aberdeen will focus on companies that: (i) are in need of managerial, technical and financial resources to realize their full potential; (ii) are undervalued in foreign capital markets; and/or (iii) operate in jurisdictions with low to moderate local political risk. Aberdeen will seek to provide value-added managerial and board advisory services to companies.
For additional information, please visit our website at www.aberdeeninternational.ca and follow us on Facebook and Twitter: AberdeenAAB.
About Landmark Partners:
Landmark Partners is a private equity and real estate company specializing in secondary funds. Formed in 1989, the firm has one of the longest track records in the industry and is a leading source of liquidity to owners of interests in venture, mezzanine, buyout, and real estate limited partnerships. Landmark has formed 30 funds focused on venture capital, buyout, mezzanine and real estate partnerships over the last 24 years. These funds have been capitalized at more than $12.5 billion. Landmark is headquartered in Simsbury, Connecticut, and has offices in Boston, Massachusetts, New York, New York, and London, England