Gensource has worked with Innovare over the last six years in the development of Gensource’s modular potash production module
Gensource Potash Corporation (“Gensource” or the “Company”) (TSXV: GSP, AIM: GSP), a fertilizer development company focused on sustainable potash production, is pleased to announce it has reached a binding agreement (the “Agreement”) to acquire 100% of the issued and outstanding shares of Innovare Technologies Ltd. (“Innovare”), a privately-held developer of patented selective solution mining and brine processing technology for the recovery of potash and other soluble minerals. Gensource’s acquisition of Innovare’s shares will occur by way of a reorganization whereby Innovare’s existing shareholders will transfer the shares they hold in Innovare to Gensource in exchange for new common shares of Gensource (“Common Shares”). Following completion of the reorganization, Innovare will exist as a wholly-owned subsidiary of Gensource and Innovare’s business will be integrated with and controlled by Gensource.
“Gensource’s acquisition of Innovare’s shares and the integration of Innovare’s business with our own will provide Gensource with exclusive use and control of Innovare’s unique and highly sought-after selective solution mining and brine processing technology for potash development, without which the environmental benefits of modern potash production would be extremely challenging to replicate”, said Mike Ferguson, Gensource’s President & CEO. “The acquisition will place the Company in a strong competitive position in an industry dominated by producing facilities based on conventional 1950s and older technology. With Innovare’s technology integrated into our business, we will have total control over production processes at the Tugaske Project and future projects we anticipate rolling out in Saskatchewan and globally, while also anticipating a reduction in life of mine costs. Gensource looks to the future and continues to lead the way in responsible potash production for a sustainable future. Gensource has had a long standing relationship with Innovare. Its technology is cutting edge and Innovare’s principals are considered by the industry as global experts in the field. This transaction will strengthen Gensource’s differentiated market position as a near term potash producer into a market that continues to see global supply challenges and is in need of a structural change if we are to support the world’s growing agricultural requirement for environmentally sustainable potash.”
Gensource has worked with Innovare over the last six years in the development of Gensource’s modular potash production module. The Company’s potash project located near Tugaske, Saskatchewan (the “Tugaske Project”) will be the first project to implement a Gensource module.
Innovare’s technology contributes industry-proven techniques and new, innovative and patented technology that de-risks selective extraction and is expected to lower capital and operating costs for the Tugaske Project and beyond. By bringing this technology in house, Gensource will control the intellectual property that allows it to implement its strategic business plan, which management of Gensource believes will be the future of potash production.
The closing of the transaction values Innovare at approximately US$11.5 million, which represents the current value of existing licensing agreements between the Company and Innovare. The Agreement remains subject to satisfaction of certain conditions precedent, including the approval of the TSX Venture Exchange, and is anticipated to close in Q2 2022.
The new Common Shares, to be issued upon close, will be issued at a price equal to the price of the Common Shares issued during the next qualifying equity fundraising of the Company, and will be subject to certain tranched disposal restrictions until the Company reaches first production. The former owners of Innovare include the corporate vehicles of the three principals, being Artisan Consulting Services Ltd, McEwan Consulting Chemical Engineering, Inc. and Ristra Consulting Inc. For the year ended December 31, 2021, Innovare reported an unaudited loss before tax of C$40,139 and gross assets of C$12,025.
Source: Company Press Release