Tactical Resources Advances Business Combination with Plum Corp
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Tactical Resources Provides Key Insights on Business Combination
Tactical Resources Corp. (TSX.V: RARE | OTC: USREF) is excited to share critical updates regarding its proposed business combination with Plum Acquisition Corp. III (NASDAQ: PLMJ), a special purpose acquisition company. This strategic merger is aimed at enhancing the operational capabilities and market position of Tactical Resources.
Understanding the Proposed Business Combination
The definitive business combination agreement was finalized on August 22, 2024. Under the terms, Plum will re-domicile in British Columbia, marrying with a newly formed company that will ultimately merge with Tactical Resources. Consequently, Tactical Resources will maintain its identity as a wholly owned subsidiary of the newly established entity, referred to as "Pubco." The name change will be mutually agreed upon by both parties following the merger.
Exchange Ratio and Valuation Details
During the proposed business combination, the Company Shares will be exchanged for newly issued Pubco Shares. The exchange ratio, which is determined by a pre-transaction equity value of US$500 million, outlines a significant financial arrangement. For instance, based on the current structure, shareholders could receive approximately 1.0477 Pubco Shares for each Company Share they hold.
Market Capitalization and Pro Forma Enterprise Value
The market capitalization of Tactical Resources stands around CAD$12.1 million based on a fully diluted basis. It is anticipated that security holders of Tactical Resources will own around 82% of Pubco following the completion of the transaction. Furthermore, the pro forma enterprise value of Pubco post-closing is projected at US$589 million, a critical indicator of the combined entity’s market outlook.
Investor Presentation and Shareholder Insights
A comprehensive investor presentation has been filed, providing further insights into the assumptions behind the pro forma enterprise value. This presentation reflects the anticipated outcome and investor expectations surrounding the business combination. The documentation outlines the potential issuance of approximately 60.9 million Pubco Shares upon the closure of the deal, which includes shares to the existing shareholders of Tactical Resources.
Plans for Capital Raising and Strategic Growth
To support Tactical Resources' expansion plans, the Company is considering raising up to US$30 million through various financing sources. The strategic “Peak Project” focuses on acquiring rare-earth element tailings, crucial for the technological industries including semiconductors and electric vehicles. The availability of this capital is pivotal for operational commencement, though details are still being negotiated.
Closing Conditions for the Business Combination
The business combination is anticipated to close in the fourth quarter of 2024, contingent upon several customary closing conditions. These include shareholder approval, necessary court orders, and regulatory clearances. Each of these conditions is vital for the successful execution of this planned merger.
Management’s Role Post-Combination
If the merger proceeds as planned, the existing management team from Tactical Resources will continue to steer the merged entity. This continuity is expected to bolster confidence among investors regarding the strategic direction of Pubco.
About Tactical Resources
Tactical Resources is committed to exploring and developing mineral resources, particularly focusing on U.S.-sourced rare earth elements. The company's innovative approaches in metallurgical processing aim to maximize the potential of rare earth development for significant industrial applications and national defense.
Contact Information
Ranjeet Sundher, Chief Executive Officer
Tel: +1-778-588-5483
For additional inquiries, please reach us at media@tacticalresources.com or to discuss investment-related matters, contact investors@tacticalresources.com.
Frequently Asked Questions
What is the significance of the proposed business combination?
The combination aims to enhance Tactical Resources' market position and operational capabilities through a strategic partnership with Plum.
What does the exchange ratio mean for shareholders?
The exchange ratio specifies how many newly issued shares of Pubco shareholders will receive for their Company Shares, directly impacting their ownership stake.
When is the proposed business combination expected to close?
The completion is projected for the fourth quarter of 2024, pending requisite approvals and conditions.
How will the management structure change post-merger?
The current management team of Tactical Resources will remain in place, ensuring continuity in leadership and strategy.
What is Tactical Resources’ main focus in the market?
Tactical Resources is primarily focused on the exploration and development of rare earth elements, crucial for technology and defense sectors.
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