LGC Capital Ltd.
Symbol: TSX-V: LG
MONTREAL, Oct. 10, 2017 /CNW Telbec/ - LGC Capital
Ltd. (TSXV: LG) ("LGC") is pleased to announce that it
has formally established a merchant banking division within its
business, which will pursue global high-yield investment
opportunities. This new division will run parallel with and will
not deter efforts from LGC's cannabis investments and the pursuit
of additional cannabis opportunities.
"The merchant banking side of LGC Capital is an
outstanding opportunity for the company and its shareholders,"
commented John McMullen, CEO of LGC. "I will remain 100%
committed and focused on building our global cannabis footprint,
while LGC's Co-Chairman Mazen Haddad will head up this
division and continue to pursue large high-yield investment
opportunities for LGC. Mazen has a successful history and track
record with sourcing funding and executing these types of
transactions."
As part of this announcement, LGC announces that it has entered
into an agreement with a Toronto-based investment firm whereby LGC will
guarantee repayment by Etea Sicurezza Group Ltd
("Etea Sicurezza") of notes issued by Etea Sicurezza in
an aggregate principal amount of USD $1,000,000 ("Notes"). The
Notes have a term of two years, bear interest at a rate equal to
LIBOR + 8%, and are secured by the assets of Etea Sicurezza
and by a pledge of shares by Etea Sicurezza's principal
shareholder.
As consideration for the guarantee, Etea Sicurezza will issue
shares to LGC representing 3% of its outstanding shares and pay an
annual cash fee to LGC.
LGC and Etea Sicurezza are also negotiating a transaction
whereby LGC will acquire all of the outstanding shares of
Etea Sicurezza and distribute a portion of the shares to LGC's
shareholders, with the intention of Etea Sicurezza becoming a
public listed company. At such time, if any, as LGC and
Etea Sicurezza enter into an agreement, LGC will issue a press
release announcing the details of the transaction.
Based in London, England, Etea
Sicurezza (www.eteasicurezzagroup.com) is a private company which
specializes in fire safety and security by providing products and
services to international companies such as L'Oreal,
Coca Cola, BASF, Doha Metro and others.
Etea Sicurezza was founded in 1998 and is now a global leader
in the field of high-tech safety with offices in seven countries
and agents in 20 countries. Etea Sicurezza operates as an
EPC (Engineering, Procurement and Construction) contractor
implementing safety systems, and provides proprietary and patented
technologies that are customized and fully compliant with
international standards. For the fiscal year ending
December 31, 2017, Etea Sicurezza already has revenues in
excess of the equivalent of CAD$14 million with margins of
27%.
"I have known the founder and principal of Etea Sicurezza for a
number of years," stated Mazen Haddad, Co-Chairman of LGC. "He
approached me on this situation and I jumped on it knowing that LGC
can help and that this opportunity can add significant value for
our shareholders."
Under the guarantee, LGC will be required to pay all of Etea
Sicurezza's obligations under the Notes if Etea Sicurezza does not
make payment to the holders of the Notes and if AIP sends a demand
letter to LGC. If LGC repays the Notes, it will be subrogated in
the rights of the holders of the Notes. In the event that LGC is
required to pay under the guarantee, it has the option to pay all
or part of the amount through the issuance of LGC shares at a price
per share equal to 80% of the weighted average trading price of
LGC's shares on the TSX Venture Exchange, or such other stock
exchange on which LGC's shares then principally trade, for the five
trading days immediately preceding the date of issuance of the
shares.
The guarantee and related issuance of shares by LGC are subject
to approval by the TSX Venture Exchange. LGC Merchant Banking has
begun the approval process but cannot give any assurance that it
will be able to obtain such approval. In addition, LGC cannot give
any assurance that it will conclude a further transaction with
Etea Sicurezza as described in this press release.
About LGC Capital
(http://www.lgc-capital.com)
LGC Capital Ltd.'s (TSXV: LG) mission is to invest into global
high-yield diversified businesses. LGC's flagship project is its
partnership with AfriAg (Pty) Ltd. and South Africa's House of Hemp to grow,
cultivate and distribute medical-grade cannabis from its 40,000
m2 facility located in Block D of the Dube Tradeport's
Agrizone Complex. This greenhouse is the most eco-friendly and high
tech agricultural facility in Africa.
FORWARD-LOOKING STATEMENTS
This press release may contain forward-looking statements with
respect to LGC Capital Ltd. ("LGC"), its operations, strategy,
investments, financial performance and condition. These statements
generally can be identified by use of forward-looking words such as
"may", "will", "expect", "estimate", "anticipate", "intends",
"believe" or "continue" or the negative thereof or similar
variations. The actual results and performance of LGC, including
the guarantee and possible further transaction with Etea Sicurezza
described herein, could differ materially from those expressed or
implied by such statements. Such statements are qualified in their
entirety by the inherent risks and uncertainties surrounding future
expectations. Some important factors that could cause actual
results to differ materially from expectations include, among other
things, general economic and market factors, competition,
government regulation and the factors described under "Risk Factors
and Risk Management" in LGC's Management's Discussion and Analysis
for the fiscal year ended September 30, 2016, as filed on
SEDAR (www.sedar.com). The cautionary statements qualify all
forward-looking statements attributable to LGC and persons acting
on its behalf. Unless otherwise stated, all forward-looking
statements speak only as of the date of this press release and LGC
has no obligation to update such statements, except to the extent
required by applicable securities laws.
Information Relating to Etea Sicurezza Group Ltd
All information contained in this press release relating to
Etea Sicurezza has been provided to LGC by
Etea Sicurezza. LGC has relied upon this information
without having made independent inquiries as to its accuracy or
completeness and assumes no responsibility for any inaccuracy or
incompleteness of such information.
Caution Regarding Press Releases
Neither the TSX Venture Exchange nor its Regulation Service
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
SOURCE LGC Capital Ltd