/NOT FOR DISSEMINATION TO UNITED
STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN
THE UNITED STATES/
TSXV: JNN
SASKATOON, Nov. 14, 2012 /CNW/ - Mr. Richard Kusmirski, President of JNR Resources
Inc. (TSXV: JNN) ("JNR" or the "Company") announces
Denison Mines Corp. (DML: TSX, DNN: NYSE MKT) ("Denison")
and JNR have signed an acquisition agreement (the "Acquisition
Agreement") pursuant to which Denison will offer to acquire all
of the issued and outstanding common shares of JNR (the "JNR
Shares") by way of a friendly take-over bid (the
"Offer"). Under the terms of the Offer, JNR
shareholders will receive 0.073 of a Denison common share (a
"Denison Share") for each JNR
Share deposited under the Offer, provided that no fractional
Denison Shares will be issued (the "Exchange Ratio").
The Offer represents a premium of 53% based on the 20-day volume
weighted average share prices of both companies on the TSX and the
TSX-V as of November 13, 2012, and a
55% premium to the closing prices immediately prior to
announcement. The Offer values JNR at approximately
$10 million. Upon completion of
the transaction, shareholders of JNR will own 2% of Denison.
The board of directors of JNR, after consulting
with its financial and legal advisers, has unanimously approved
entering into the Acquisition Agreement and unanimously recommends
that JNR shareholders tender their shares pursuant to the
Offer. JNR's board of directors has received an initial
fairness opinion from its financial advisor that the consideration
offered by Denison for the JNR Shares under the Offer is fair, from
a financial point of view, to JNR shareholders. In addition,
in conjunction with the Acquisition Agreement, certain directors
and officers of JNR are entering into lock-up agreements with
Denison, which together represents approximately 4.5% of the issued
and outstanding JNR Shares.
"We believe that the acquisition of JNR is a
logical consolidation step for Denison and advances our goal to
become the preeminent exploration company in the Athabasca Basin." commented Lukas Lundin, Chairman of Denison.
"JNR is excited to combine with long-time
multiple joint-venture partner, Denison. We believe this
transaction provides our shareholders with excellent value for our
current assets, along with continued exposure to future exploration
success." said Rick Kusmirski,
CEO & Director of JNR.
Transaction Benefits to JNR
Shareholders
- Substantial premium to JNR shareholders; above market, 53%
premium to JNR shareholders on a 20-day volume weighted average
price basis as of November 13,
2012
- Denison is an established explorer and operator in the
Athabasca Basin, with a strong
track record of success
- Exploration synergies, including six current Joint Ventures
with Denison on properties in the Athabasca Basin
- JNR shareholders to benefit from Denison's strong balance
sheet, capital market presence and the ability to fund future
exploration programs
Transaction Summary
Denison expects to acquire JNR by way of a
take-over bid whereby Denison will offer to acquire all of the
issued and outstanding JNR Shares on the basis of 0.073 Denison
Shares for each JNR Share deposited under the Offer. As part
of this transaction, Denison also intends to offer replacement
warrants and options to holders of outstanding JNR warrants and
options on similar terms as adjusted by the Exchange Ratio.
The Acquisition Agreement provides for, among
other things, a non-solicitation covenant on the part of JNR, a
right in favour of Denison to match any superior proposal, and a
termination fee of $325,000 payable
to Denison in certain circumstances, including if JNR accepts a
superior proposal.
The Offer is expected to be made pursuant to a
take-over bid circular, and related documents are to be mailed to
JNR shareholders in accordance with applicable laws (all subject to
the terms and conditions of the Acquisition Agreement). The
Offer will be open for acceptance for a period of not less than 35
days from its commencement and may be extended from time to
time. The Offer will be subject to customary conditions,
including, among other things, at least two-thirds of the JNR
Shares being deposited under the Offer, receipt of requisite
regulatory consents and the absence of a material adverse change
with respect to JNR.
Concurrently with the execution of the
Acquisition Agreement, Denison and JNR have entered into an
unsecured loan agreement (the "Loan Agreement") pursuant to
which Denison will advance $350,000
(the "Principal") to JNR. The Principal shall be
payable in full on the termination of the Acquisition Agreement by
either party thereto for any reason at any time (the "Due
Date"). Upon and after the Due Date and until the
Principal is repaid in full, interest shall be calculated on the
Principal outstanding at the rate of 5% per annum.
Haywood Securities Inc. is acting as financial
advisor to Denison, while Toll Cross Securities Inc. is acting as
financial advisor to JNR. Cassels
Brock & Blackwell LLP is acting as legal advisor to
Denison, and Maitland & Co. is acting as legal advisor to
JNR.
This press release does not constitute an offer
to buy or an invitation to sell, or the solicitation of an offer to
buy or invitation to sell, any securities of Denison or JNR.
Such an offer may only be made pursuant to a take-over bid circular
and related documents filed with the securities regulatory
authorities in Canada.
Denison intends to file a take-over bid circular with Canadian
provincial securities regulators. Denison also intends to
file with the U.S. Securities and Exchange Commission (the "SEC") a
Registration Statement on Form F-8 which will include the take-over
bid circular. Investors and security holders are urged to
read the take-over bid circular and related documents regarding the
proposed transaction referred to in these documents when they
become available, because they will contain important
information. Investors may obtain a free copy of the
take-over bid circular, when it becomes available, and other
documents filed by Denison with the Canadian provincial securities
regulators on SEDAR at www.sedar.com, and with the SEC at
the SEC's website at www.sec.gov. The take-over bid circular
and related documents may also be obtained for free, once they have
been mailed, on Denison's website. Free copies of any such
documents could also be obtained by directing a request to Denison
at 595 Bay Street, Suite 402, Toronto,
Ontario, Canada, M5G 2C2.
Additional Matters
In conjunction with this announcement, JNR
advises that:
- The private placement to raise funds by way of an equity
offering, announced on November 5,
2012, has been cancelled; and
- Mr. Ron Hochstein, a director of
Denison, has resigned from his position as a director of JNR so as
to avoid any conflicts of interest regarding Denison's proposed
acquisition of JNR.
Additional Information
Additional information about Denison is
available on Denison's website at www.denisonmines.com or
under its profile on SEDAR at www.sedar.com and on EDGAR at
www.sec.gov.
About JNR Resources Inc.
JNR Resources Inc. is a Canada-based junior uranium exploration
company with mineral properties in the provinces of Saskatchewan and Newfoundland. JNR is led by a highly
experienced management team with proven discovery success in
uranium as well as precious and base metal exploration. The
Company's primary focus is in the Athabasca Basin, recognized as the most
prospective uranium-mining district in the world. JNR controls a
100% interest in six properties in the basin totalling 193,965
hectares and an additional six joint venture properties totalling
129,803 hectares in which Denison Mines Corp. has varying
interests. JNR also holds a 50% interest in the 29,824-hectare
South Fork uranium property located in the Cypress Hills area of
southwestern Saskatchewan, with
joint venture partner Mega Uranium Ltd. In Newfoundland, JNR holds a 73.4% interest
(Altius Mineral Corporation 26.6%) in the 6,450-hectare
Rocky Brook uranium property and is
also in a 50:50 alliance with Altius on its 105,675-hectare
Topsails uranium property.
About Denison
Denison Mines Corp. is a uranium exploration and
development company with interests in exploration and development
projects in Saskatchewan,
Zambia and Mongolia. As well, Denison has a 22.5%
ownership interest in the McClean Lake uranium mill, located in
northern Saskatchewan, which is
one of the world's largest uranium processing facilities.
Denison's exploration project portfolio includes the world-class
Phoenix deposit located on its 60%
owned Wheeler River project also in the Athabasca Basin region of Saskatchewan. Denison is engaged in mine
decommissioning and environmental services through its Denison
Environmental Services (DES) division. Denison is also the
manager of Uranium Participation Corporation (TSX-U), a publicly
traded company which invests in uranium oxide in concentrates and
uranium hexafluoride.
ON BEHALF OF THE BOARD
Rick
Kusmirski
President & CEO
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this news release.
SOURCE JNR Resources Inc.