ONTARIO – Noront Resources' buyout of the Ontario assets of Cliffs Natural Resources has closed, but not without controversy and only after the intervention of the court. Toronto-based Noront offered US$20 million last month for Cliffs' chromite properties in the Ring of Fire, 500 km northeast of Thunder Bay.
The deal quickly drew fire from a number of First Nations, who objected the way the transaction was put together. In a release the chiefs of the Marten Falls and Aroland First Nations said the bidding process, "… has not been inclusive and transparent, leading to a potential unfair and biased outcome."
The Quebec Superior Court approved the Noront purchase before market opening on April 28, 2015, after the company revised its bid upwards to US$27.5 million. There had been a competing bid, one that was rejected by Cliffs on the grounds that it was not superior to the Noront bid.
The deal covers 103 claims including a 100% interest in the Black Thor chromite deposit, a 100% interest in the Black Label chromite deposit, and a 70% interest Big Daddy chromite deposit (the remaining 30% belongs to Toronto's KWG Resources). Noront also becomes the 85% owner of the McFaulds Lake copper-zinc property. Financing would be provided by Franco-Nevada in return for a 3% net smelter royalty.
"We feel $27.5 million is an attractive price for the acquisition of these strategic assets, which alongside our Eagle's Nest nickel-copper-platinum group element deposit and our Blackbird chromite deposit will allow us to further our vision of becoming the leading resource company in the Ring of Fire," said Noront President and CEO Alan Coutts. "Our next step is to have meaningful dialogue with the local First Nations and government regarding the development of these chromite assets which represent a generational opportunity."
Please see the Noront website at NorontResources.com.
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