MagIndustries: Difference between revisions
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==History== |
==History== |
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===Establishment=== |
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| ⚫ | The company |
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The company was established in 1997 as Congo Minerals Inc. and set out to be a low-cost producer of magnesium from the [[Republic of Congo]]. In May 1997 it concluded an exploration research agreement with the Congolese Ministry of Mines in the [[Kouilou]] area, which included the Holle Mine, a former potash producing mine. On the corporate side, the newly established private company converted itself into a publicly traded company by conducint a [[reverse takeover]]. In October 1997 the company emerged as the Magnesium Alloy Corporation through amalgamation with Clavos Enterprises, a largely inactive publicly traded company. The executive team at this stage included Chairman and President George Creber, Executive Vice-President William Burton and Vice-President Kim Barkan. The board of directors included the three executives and Stephen Dattels and Patrick Mitchell.<ref name="magnesium">{{cite news |title=Magnesium Alloy active in Republic of Congo |url=http://www.northernminer.com/news/exploration-1998-magnesium-alloy-active-in-republic-of-congo/1000148091/ |work=The Northern Miner |date=March 9, 1998}}</ref> |
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====Diversification=== |
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| ⚫ | The company became engaged in business lines outside of magnesium mining and changed its name in February 2005 to MagIndustries from Magnesium Alloy Corporation to reflect its interests in "multiple businesses and products".<ref name="namechange">{{cite news |title=TSX Venture Exchange Approve Name Change to MagIndustries Corp. |url=http://www.marketwired.com/press-release/tsx-venture-exchange-approve-name-change-to-magindustries-corp-530329.htm |work=Market Wired |date=February 4, 2005}}</ref> The varied interests included the MagForestry division formed through transactions made in 2005-6 resulting in the acquisition of a 68,000 hectare eucalyptus plantation, located mostly on the surface of areas where the company held mineral rights.<ref name="magforestry">{{cite news |title=MagForestry Division of MagIndustries Acquires 100% Control of Congo Eucalyptus Operation |url=http://www.marketwired.com/press-release/magforestry-division-magindustries-acquires-100-control-congo-eucalyptus-operation-tsx-maa-607261.htm |work=Market Wired |date=August 10, 2006}}</ref> |
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By the late 2000s, potash enjoyed the limelight as the price of the mineral and key ingredient in chemical fertilizer skyrocketed. The primary business of MagIndustries was to advance the Mengo [[potash]] project (formerly called Kouilou).<ref name="financialpost">{{cite news |last1=Koven |first1=Peter |title=MagIndustries taken over by China's Evergreen |url=https://business.financialpost.com/commodities/mining/magindustries-taken-over-by-chinas-evergreen |work=Financial Post |date=April 20, 2011}}</ref><ref name="crunch">{{cite news |title=Three junior potash picks |url=http://www.miningmarkets.ca/news/three-junior-potash-picks/ |work=Mining Markets |date=December 10, 2010}}</ref> |
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===Hunt for a strategic buyer=== |
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Throughout the 2000s and early 2010s the company sought a strategic buyer that would be able to invest the estimated US$1 billion necessary to develop the mine.<ref name="financialpost"/> In 2009 it was in talks with Chinese state owned enterprises [[Sinohydro]] and [[Complant]] but those talks fell through. The company announced an investment in late 2010 with investment company TSC Capital but the proposed deal was terminated.<ref name="tsc">{{cite news |title=MagIndustries shares plummet after TSC Capital cancels investment |url=http://www.miningcapital.com/companies/news/76231/magindustries-shares-plummet-after-tsc-capital-cancels-investment-12237.html |work=Mining Capital |date=February 11, 2011}}</ref> In 2011, a Chinese private company, Evergreen Industries Group, purchased 76% of the shares of the company for $115 million.<ref name="financialpost"/> After the acquisition, the company was kept listed on the [[Toronto Stock Exchange]]. An executive of the company in public remarks found that Western investors were not familiar with the [[Republic of Congo]] and put off by risks of the location and so avoided investing in the company.<ref name="financialpost"/> |
Throughout the 2000s and early 2010s the company sought a strategic buyer that would be able to invest the estimated US$1 billion necessary to develop the mine.<ref name="financialpost"/> In 2009 it was in talks with Chinese state owned enterprises [[Sinohydro]] and [[Complant]] but those talks fell through. The company announced an investment in late 2010 with investment company TSC Capital but the proposed deal was terminated.<ref name="tsc">{{cite news |title=MagIndustries shares plummet after TSC Capital cancels investment |url=http://www.miningcapital.com/companies/news/76231/magindustries-shares-plummet-after-tsc-capital-cancels-investment-12237.html |work=Mining Capital |date=February 11, 2011}}</ref> In 2011, a Chinese private company, Evergreen Industries Group, purchased 76% of the shares of the company for $115 million.<ref name="financialpost"/> After the acquisition, the company was kept listed on the [[Toronto Stock Exchange]]. An executive of the company in public remarks found that Western investors were not familiar with the [[Republic of Congo]] and put off by risks of the location and so avoided investing in the company.<ref name="financialpost"/> |
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===Bribery investigation and collapse=== |
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The company was investigated by the [[Royal Canadian Mounted Police]] for making corrupt payments to Congolese officials. The RCMP raided the Toronto office of the company in January 2015. The company began an independent investigation after the raid and in June 2015 the investigation presented allegations that the company had made payments and given gifts to Congolese officials. Among the allegations presented were five payments ranging from US$5,000 to US$51,000 to Congolese officials, a house built for a government official, and gifts from furniture and ornamental stone lions to 4x4 vehicles. The company was unable to fund a continuation of the internal investigation and the controlling shareholder Evergreen Holding Group refused to provide the funds. The corruption investigation and lack of funding sent the company into disarray. The company stopped filing financial reports and the stock ceased trading on the TSX. By June 2015, the board of directors involved in the corruption investigation resigned and the chief financial officer was removed.<ref name="investigation">{{cite news |title=MagIndustries Corp reveals evidence that subsidiaries allegedly paid major bribes in Republic of Congo |url=https://business.financialpost.com/commodities/mining/magindustries-reveals-evidence-that-company-paid-major-bribes-in-republic-of-congo |work=Financial Post |date=June 17, 2015}}</ref> |
The company was investigated by the [[Royal Canadian Mounted Police]] for making corrupt payments to Congolese officials. The RCMP raided the Toronto office of the company in January 2015. The company began an independent investigation after the raid and in June 2015 the investigation presented allegations that the company had made payments and given gifts to Congolese officials. Among the allegations presented were five payments ranging from US$5,000 to US$51,000 to Congolese officials, a house built for a government official, and gifts from furniture and ornamental stone lions to 4x4 vehicles. The company was unable to fund a continuation of the internal investigation and the controlling shareholder Evergreen Holding Group refused to provide the funds. The corruption investigation and lack of funding sent the company into disarray. The company stopped filing financial reports and the stock ceased trading on the TSX. By June 2015, the board of directors involved in the corruption investigation resigned and the chief financial officer was removed.<ref name="investigation">{{cite news |title=MagIndustries Corp reveals evidence that subsidiaries allegedly paid major bribes in Republic of Congo |url=https://business.financialpost.com/commodities/mining/magindustries-reveals-evidence-that-company-paid-major-bribes-in-republic-of-congo |work=Financial Post |date=June 17, 2015}}</ref> The company was delisted from the Toronto Stock Exchange in August 2015.<ref name="delist">{{cite news |title=MagIndustries Corp. Announces Results of Delisting Review |url=http://www.marketwired.com/press-release/magindustries-corp-announces-results-of-delisting-review-tsx-maa-2039972.htm |work=Market Wired |date=July 20, 2015}}</ref> |
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==References== |
==References== |
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Revision as of 14:26, 1 August 2018
| Company type | Private company |
|---|---|
| Industry | Mining |
| Founded | 1997 |
| Headquarters | Toronto, Canada |
| Website | None |
MagIndustries is a Canadian mining company majority owned by a Chinese shareholder.
History
Establishment
The company was established in 1997 as Congo Minerals Inc. and set out to be a low-cost producer of magnesium from the Republic of Congo. In May 1997 it concluded an exploration research agreement with the Congolese Ministry of Mines in the Kouilou area, which included the Holle Mine, a former potash producing mine. On the corporate side, the newly established private company converted itself into a publicly traded company by conducint a reverse takeover. In October 1997 the company emerged as the Magnesium Alloy Corporation through amalgamation with Clavos Enterprises, a largely inactive publicly traded company. The executive team at this stage included Chairman and President George Creber, Executive Vice-President William Burton and Vice-President Kim Barkan. The board of directors included the three executives and Stephen Dattels and Patrick Mitchell.[1]
=Diversification
The company became engaged in business lines outside of magnesium mining and changed its name in February 2005 to MagIndustries from Magnesium Alloy Corporation to reflect its interests in "multiple businesses and products".[2] The varied interests included the MagForestry division formed through transactions made in 2005-6 resulting in the acquisition of a 68,000 hectare eucalyptus plantation, located mostly on the surface of areas where the company held mineral rights.[3]
By the late 2000s, potash enjoyed the limelight as the price of the mineral and key ingredient in chemical fertilizer skyrocketed. The primary business of MagIndustries was to advance the Mengo potash project (formerly called Kouilou).[4][5]
Hunt for a strategic buyer
Throughout the 2000s and early 2010s the company sought a strategic buyer that would be able to invest the estimated US$1 billion necessary to develop the mine.[4] In 2009 it was in talks with Chinese state owned enterprises Sinohydro and Complant but those talks fell through. The company announced an investment in late 2010 with investment company TSC Capital but the proposed deal was terminated.[6] In 2011, a Chinese private company, Evergreen Industries Group, purchased 76% of the shares of the company for $115 million.[4] After the acquisition, the company was kept listed on the Toronto Stock Exchange. An executive of the company in public remarks found that Western investors were not familiar with the Republic of Congo and put off by risks of the location and so avoided investing in the company.[4]
Bribery investigation and collapse
The company was investigated by the Royal Canadian Mounted Police for making corrupt payments to Congolese officials. The RCMP raided the Toronto office of the company in January 2015. The company began an independent investigation after the raid and in June 2015 the investigation presented allegations that the company had made payments and given gifts to Congolese officials. Among the allegations presented were five payments ranging from US$5,000 to US$51,000 to Congolese officials, a house built for a government official, and gifts from furniture and ornamental stone lions to 4x4 vehicles. The company was unable to fund a continuation of the internal investigation and the controlling shareholder Evergreen Holding Group refused to provide the funds. The corruption investigation and lack of funding sent the company into disarray. The company stopped filing financial reports and the stock ceased trading on the TSX. By June 2015, the board of directors involved in the corruption investigation resigned and the chief financial officer was removed.[7] The company was delisted from the Toronto Stock Exchange in August 2015.[8]
References
- ^ "Magnesium Alloy active in Republic of Congo". The Northern Miner. March 9, 1998.
- ^ "TSX Venture Exchange Approve Name Change to MagIndustries Corp". Market Wired. February 4, 2005.
- ^ "MagForestry Division of MagIndustries Acquires 100% Control of Congo Eucalyptus Operation". Market Wired. August 10, 2006.
- ^ a b c d Koven, Peter (April 20, 2011). "MagIndustries taken over by China's Evergreen". Financial Post.
- ^ "Three junior potash picks". Mining Markets. December 10, 2010.
- ^ "MagIndustries shares plummet after TSC Capital cancels investment". Mining Capital. February 11, 2011.
- ^ "MagIndustries Corp reveals evidence that subsidiaries allegedly paid major bribes in Republic of Congo". Financial Post. June 17, 2015.
- ^ "MagIndustries Corp. Announces Results of Delisting Review". Market Wired. July 20, 2015.