TNR Gold Corp (TSX-V:TNR, OTC:TRRXF) has responded to Lithium Royalty Corp (TSX:LIRC)’s decision to withdraw its unsolicited bid for the royalty company.
Following receipt of the non-binding all-cash offer to acquire TNR Gold in September, TNR’s board of directors formed a Special Committee comprising independent directors to explore various strategic transaction possibilities with TNR, including potential offers.
However, the Special Committee deemed LRC's unsolicited offer to acquire all of TNR Gold's issued and outstanding common shares for cash consideration of $0.08 per share as "opportunistic" and "financially inadequate" and not in the best interests of TNR or its shareholders.
"We welcome this increased attention on our fantastic company, and we believe shareholders, investors and strategic partners see that the current share price of TNR deeply undervalues the company and its assets,” TNR Gold's CEO and executive chairman Kirill Klip said in a statement.
TNR holds a 1.35% NSR royalty on the Mariana Lithium project that is being developed by Ganfeng Lithium in Argentina, a 0.36% NSR royalty on the Los Azules copper project that is being developed by McEwen Mining in Argentina, and a 7% net profits royalty on the Batidero I and II properties of the Josemaria project that is being developed by Lundin Mining in Argentina.
TNR also provides significant exposure to gold through its 90% holding in the Shotgun gold porphyry project in Alaska.
Klip emphasized the company's commitment to maximizing shareholder value and expressed confidence in the company and its assets.
TNR has been in discussions with multiple parties offering higher potential valuations for its assets than the recent proposal by Lithium Royalty Corp (TSX:LIRC), according to the CEO.
Further, TNR is actively exploring options to unlock additional value for its shareholders, including the potential spin-out of its Shotgun gold project assets into a new public company, with all TNR shareholders receiving shares in the new entity.
"The company's strategy with the Shotgun gold project is to attract a joint venture partnership with a major gold mining company,” Klip told investors.
“The company is actively introducing the project to interested parties. TNR is also considering a plan to unlock additional value for our shareholders by the potential spin-out of its Shotgun gold project assets in Alaska, into a new public company. Should the spin-out occur, all shareholders of TNR will receive shares of the new public company.”
The company is strategically focused on its portfolio of assets, which include royalties in world-recognized projects being developed by industry leaders such as Ganfeng Lithium, McEwen Mining, Rio Tinto, Stellantis, and Lundin Mining.
The company said it will refrain from further comments on the ongoing process, except as required by applicable securities laws or regulatory policies. There is no guarantee that discussions will lead to a transaction, and if a transaction is pursued, its timing and terms remain uncertain.