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Old 11-29-2016, 04:42 PM   Nav to Top  #1
JonnyR512
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Default PCI.V - Perlite Canada Inc.

Perlite Canada Inc(PCI.V) Due Diligence Report

Price: $0.18
Common Shares: 10,813,059
Insider Holdings: 2,823,000 or 26.1% as per the information circular sheet
Institutional Holdings: 2,790,000 or 25.4% as per the information circular sheet
Total Holdings: 51.5% or 5,613,000
Website: www.perlitecanada.com

9 Month Revenue/Income
2016 Sales - $5,475,625 (2015 - $4,638,593)
2016 Profit - $673,646 (2015 – Loss of $96,376)
2016 earnings per share of $0.062 (With one time earning included)
2016 earnings per share of $0.027 (Without one time earning included)
Note: One time earning of $388,029 due to a legal issue that has been settled

ASSETS
Accounts Receivable: $1,022,898
Tax Credit Receivable: $32,738
Inventory: $481,069
Prepaid Expenses: $79,153
Property & Equipment: $2,671,863
Customer Relationships: $101,675
Total Assets: $4,389,396

LIABILITIES
Bank Debt: $767,414
Accounts Payable: $2,224,589
Current portion of long term debt: $384,404
Loans: $9,594
Long term debt: $48,795
Total Liabilities: $3,434,796

MD&A Highlights

Perlite Canada inc. (the "Corporation") specializes in the processing, distribution and sale of perlite and vermiculite.

The Corporation generated revenues of $ 1,748,845 during the third quarter ended July 31, 2016 (the “3rd Quarter 2016”) compared to $ 1,355,475 as at July 31, 2015, which represents an increase of sales of approximately 29%. For the nine month period ending on July 31, 2016, total sales were $5,475,625 compared to $4,638,593 for the same period in 2015, being an increase of approximately % 18.

The increase of the Corporation’s revenues during the nine month period ended July 31, 2016 is therefore mainly explained by the increase of sales of perlite products. The Corporation does not own a perlite or vermiculite mine and sources its raw perlite and vermiculite from third party suppliers. A change of raw material supplier can generate fluctuations in costs and/or product characteristics. In order to ensure an optimal supplying of raw material, the Corporation is in constant contact with different mines around the world and periodically analyzes available perlite and vermiculite sources. Management of the Corporation believes that the Corporation counts presently on sufficient sources to ensure a steady perlite and vermiculite supply for the next fiscal years.

For the nine month period ending on July 31, 2016, the Corporation registered earnings before taxes of $673,646 compared to a loss before taxes of $96,376 for the nine month period ended July 31, 2015. Without taking into account the Gain on Settlement, the Corporation would have recorded earnings of $285 617.

Management believes that the Corporation has the ability to continue as a going concern notwithstanding the fact the it has a negative working capital because, on the one hand, the Corporation is in compliance with its financial ratios and on the other hand its long term debt will be totally reimbursed during the next few months. Furthermore, the Corporation adjusted the selling prices of its products during the previous quarter of 2016. Moreover, the Corporation has a relatively stable customer basis with which it has had a good relationship for years.
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Old 11-30-2018, 05:22 PM   Nav to Top  #2
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Perlite Canada Inc
Symbol C : PCI
Shares Issued 10,813,059
Close 2018-11-26 C$ 0.60
Recent Sedar Documents
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Perlite Canada management to take company private

2018-11-29 16:21 MT - News Release


Mr. Richard Barabe reports

PERLITE CANADA INC. ANNOUNCES AGREEMENT WITH MANAGEMENT TO TAKE THE CORPORATION PRIVATE FOR A CASH CONSIDERATION OF $0.80 PER SHARE

Perlite Canada Inc. has entered into an acquisition agreement pursuant to which Richard Barabe, president and chief executive officer, and Martin Joyal, secretary, will acquire, through a newly formed corporation, all of the issued and outstanding common shares of the corporation, other than shares held directly or indirectly by the principals, at a price of 80 cents in cash per share, and Perlite will be taken private for a total consideration of approximately $6,392,000. The principals directly or indirectly hold approximately 26.11 per cent of the issued and outstanding common shares of the corporation. The transaction values Perlite's equity at approximately $8.65-million.

The 80-cent-per-share cash consideration represents a premium of approximately 33 per cent to the closing price of the common shares of the corporation on the TSX Venture Exchange on Nov. 28, 2018, the last day of trading prior to the date hereof, a premium of approximately 36 per cent to the volume-weighted average trading price of the shares in the last 20 days of trading on the TSX-V and a premium of approximately 31 per cent to the volume-weighted average trading price of the shares in the last 12 months of trading on the TSX-V.

"We are very pleased to be able to allow our shareholders who have supported us for years to monetize their investment and benefit from the substantial growth in value of the corporation during the last years while receiving a significant premium for their shares," Mr. Barabe said.

"We are pleased to present this transaction to the minority shareholders of Perlite, which will provide them with an opportunity to monetize their investment for a significant cash premium and immediate liquidity upon closing," remarked Faycal Salek, chairman of the special committee of the corporation.

The transaction allows for the continued commitment of the principals to the success of Perlite for the long term, and Mr. Barabe will continue as president and CEO and Mr. Joyal will continue as corporate secretary of Perlite.

The transaction is to be structured as an amalgamation of the corporation with the purchaser, under the laws of the Province of Quebec. Upon the completion of the amalgamation, shareholders of Perlite, other than the principals, will receive one redeemable share of the corporation resulting from the amalgamation for each common share of Perlite they hold. Each redeemable share will then be immediately redeemed for 80 cents in cash.

Pursuant to the terms of the acquisition agreement, the holders of options of the corporation who are directors of the corporation shall remit and surrender all of their options for cancellation, as of the effective time of the amalgamation, without any cash or other consideration. The options owned by the other holders shall be terminated and cancelled, as of the effective time of the amalgamation, in exchange for a cash payment by the corporation equal to the difference between 80 cents per vested option and the exercise price of such options (less any applicable withholding) in accordance with the terms of the corporation's stock option plan.

In accordance with applicable securities laws, the board of directors of the corporation established the special committee comprising all of its independent directors in order to, among other things, review and consider the proposed form, structure, terms, conditions and timing of the transaction, as well as any alternative transaction proposed to the corporation, make such recommendations to the board as it considers appropriate or desirable in relation to any such transaction, and provide advice and guidance to the board as to whether one or more transactions is or are in the best interests of the corporation. The members of the special committee, Mr. Salek and Patrick Barriault, retained Norton Rose Fulbright Canada LLP as independent legal adviser, and Richter Advisory Group Inc. was retained to advise the special committee and to prepare a fairness opinion in respect of the transaction, notwithstanding the statutory exemption from the formal valuation requirement set out in Regulation 61-101 respecting protection of minority security holders in special transactions.

Richter has provided the special committee with its opinion that, as of the date hereof, subject to the assumptions, limitations and qualifications contained therein, the consideration to be received by shareholders of Perlite other than the principals pursuant to the transaction is fair, from a financial point of view, to the minority Shareholders.

Based on Richter's conclusions, among other matters considered, and after consultation with its financial and legal advisers, the special committee unanimously determined that the transaction is fair to the minority shareholders and is in the best interests of Perlite. The special committee has unanimously recommended that the board of directors of the corporation approve the transaction and that the corporation enter into the acquisition agreement, and, following this recommendation, the board of directors of the corporation unanimously approved the transaction (with interested directors Mr. Barabe and Mr. Joyal having abstained) and recommends that the minority shareholders vote their common shares of the corporation in favour of the transaction.

Shareholders of the corporation will be asked to approve the transaction at a special meeting which the corporation currently expects will be held in January, 2019. Completion of the transaction is subject to customary closing conditions, including, but not limited to, the approval of at least two-thirds of the shareholders of the corporation voting at the meeting and of a simple majority of the minority shareholders voting at the meeting, and there being no material adverse change with respect to Perlite. The acquisition agreement governing the transaction contains customary representations, warranties and covenants for a transaction of this nature. Assuming the satisfaction of all conditions, the transaction is expected to close in the week following the meeting.

Further details of the transaction, including a copy of the fairness opinion, and the detailed reasons for the favourable recommendation to shareholders of the corporation by the board of directors of the corporation and the special committee, will be contained in the management information circular to be mailed to shareholders of the corporation in December, 2018, in connection with the meeting.

The transaction is not subject to a financing condition, and the principals have confirmed that financing has been arranged to finance the transaction through committed debt facilities. The principals have also confirmed their intent to consummate the transaction to the exclusion of any other alternative transaction.

A copy of the acquisition agreement, the circular (including the fairness opinion) and certain related documents will be filed in due course on SEDAR.

Fasken Martineau DuMoulin LLP is acting as legal adviser to the principals.

Shareholders should consult their own tax and investment advisers with respect to the transaction, details of which will be contained in the circular.

About Perlite Canada Inc.

Perlite specializes in the processing, distribution and sale of perlite and vermiculite. Perlite and vermiculite are used in the construction, industrial and horticultural sectors. The corporation produces expanded perlite and exfoliated vermiculite in its two Canadian plants; one is located in Lachine (Quebec) and the second is located in Saint-Pacome (Quebec).

We seek Safe Harbor.

© 2018 Canjex Publishing Ltd. All rights reserved.
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Old 11-30-2018, 05:23 PM   Nav to Top  #3
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Called this basically two years ago and anyone who bought made over 300%. Not easy to do in these awful markets, but profitable companies always take off. Keep an eye on AXM.V, CAF.V and SSA.V they have the same potential.
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