Apr. 2, 2014 - Canada Fluorspar, which has 41 known mineralized veins on its fluorspar assets in St. Lawrence, Newfoundland, said Wednesday that it has agreed to be acquired by San Francisco-based private equity firm Golden Gate Capital in an all-cash deal at a price of 35 cents per share. 
This would value the deal at $38.8 million, according to calculations using 110.86 million shares issued and outstanding.
The definitive agreement has already been approved by the company's board. Canada Fluorspar said the consideration represents a 67% premium to its closing price on Tuesday. 
Golden Gate, with $12 billion of capital under management, has also agreed to provide a $2.0 millon convertible advance to the company, which can be converted into units of Canada Fluorspar at any time prior to April 1, 2016, at a price of 20 cents apiece. The proceeds will be used to fund the junior's ongoing operations until the closing of the transaction.
Once the deal is completed, Canada Fluorspar's shares will be delisted from the TSX Venture Exchange. 
The announcement follows the release of new mineral resources from two deposits at its St. Lawrence property in Newfoundland in December, with the company saying at the time that further infill drilling is necessary to increase the estimate at its AGS vein. The NI 43-101 compliant resource, for the Director and AGS veins, included 2.1 million tonnes of indicated mineral resources at an average grade of 51% fluorspar, and 8.5 million tonnes of inferred resources at an average grade of 42.2% fluorspar. 
Canada Fluorspar has 41 known mineralized veins on its fluorspar assets in St. Lawrence, two of which – Blue Beach and Tarefare - have been drilled and vended into a partnership with French chemical giant Arkema, while drill rigs started working at the Director Vein last January, later moving onto the AGS vein, formerly known as Grebes Nest. 
"CFI is very pleased to announce this transaction with Golden Gate Capital," said Canada Fluorspar's president and CEO, Lindsay Gorrill, in the release Wednesday.
Shares of Canada Fluorspar were halted this morning pending the announcement, at 21 Canadian cents, and popped nearly 62% shortly after they resumed trading, to 34 Canadian cents. 
"The consideration offered by Golden Gate Capital provides immediate liquidity and a significant premium to the current share price and we are recommending that shareholders vote in favour of the Arrangement. 
"We are pleased to note that Golden Gate Capital has a vision for the St. Lawrence Fluorspar project that, combined with its financial strength, will help ensure a long-term economically viable project that will benefit the town of St. Lawrence and the Burin Peninsula."
The deal is still subject to several conditions, including shareholder, court and regulatory approvals. The company said that more than 39% of shareholders have entered lock-up agreements in favour of the transaction.
Under the terms, Canada Fluorspar cannot solicit any other offers, with Golden Gate given the right to match any superior bids that may arise. A special meeting of the company's shareholders is to be held in May.
Fluorspar is used to reduce the amount of energy needed to produce aluminum, and is also used for photovoltaic solar panels, but the biggest application is fluoro chemicals – which are used in products ranging from air conditioners and refrigerants to lithium batteries and the material Gore-Tex. 
Historic mining operations on the St. Lawrence property produced more than 4.2 million tonnes of fluorspar for 44 years until 1977. Production resumed in 1986 and continued until 1991, when St. Lawrence Fluorspar reopened the nearby Blue Beach North Mine and processed 440,000 tonnes of ore from small open pits, one of which was located in a surface pillar at the Director Mine near the main shaft.