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 DENVER, Sept. 3 /PRNewswire/ -- Atlas Corp. (NYSE: AZ) announced today that it has entered into an agreement with Phoenix Financial Holdings Inc. providing for the sale by Atlas for an aggregate of $8,375,000 of (i) 1,500,000 shares of Atlas Common Stock, (ii) an Atlas Redeemable Convertible Debenture due 1998 in the principal amount of $3,500,000, which is convertible as to principal into Atlas Common Stock at the rate of $4 per share and bears interest at the rate of 9 percent per annum payable in cash or Common Stock at the rate of $4 per share, and (iii) Warrants to purchase for three years 2,000,000 shares of Atlas Common Stock at $3.625 per share. Phoenix has arranged for the private sale through a Canadian underwriting firm to a group of individual and institutional investors of the 1,500,000 shares of Common Stock and Warrants to purchase 750,000 shares of Common Stock. Phoenix expects that one of its controlled affiliates will purchase the Debenture. Phoenix is a Toronto-based Canadian corporation which has several gold mining investments and affiliations.
 The sale of Atlas securities to Phoenix would normally require approval of the company's stockholders under the Shareholder Approval Policy of the New York Stock Exchange. However, the Audit Committee of the Atlas board of directors has determined that the delay associated with obtaining stockholder approval prior to completing the transaction would seriously jeopardize the financial viability of Atlas. Because of that determination, the Audit Committee, pursuant to an exception provided in the Exchange's Shareholder Approval Policy for this kind of situation, expressly approved not seeking the stockholder approval that would otherwise have been required under the policy. The Atlas board of directors concurred in that decision.
 As the company has previously reported, its financial condition has been deteriorating. For the fiscal year ended June 30, 1993, the company expects to report an operating loss of approximately $13 million before a charge which is expected to be in the range of $24 million to $29 million to reflect reductions in the company's estimated ore reserves and the impact of those reductions on the values of other assets and liabilities. The company has been seeking for some time to raise equity and debt capital or find a merger partner or potential acquiror. The transaction with Phoenix has resulted from those efforts. If the Phoenix transaction is not completed and another capital infusion is not immediately arranged, the company will not have sufficient funds to continue operations.
 Douglas R. Cook, the company's chairman, stated, "The transaction with Phoenix presents a positive opportunity for the company's stockholders. Upon its completion, the financial condition of Atlas will be much improved. It will have needed working capital and be able to engage in a meaningful gold exploration program and consider property acquisition and business combination opportunities. The company's board of directors is convinced that the transaction is in the best interests of Atlas and its stockholders." Endeavour Financial Inc., the company's financial advisor for the transaction, has delivered to the board its opinion that the terms of the transaction are fair.
 When the transaction closes, the Atlas board of directors will be reconstituted to consist of Douglas R. Cook and Edgar M. Masinter, who are currently serving as directors, and David J. Birkenshaw, James D. Beatty, David P. Hall and David A. Knight, who have been designated by Phoenix. Birkenshaw is the president of Phoenix, which he founded, and is actively involved in a number of other business and financial interests. Beatty is the president of Trinity Capital Corp., a Toronto- based investment banking firm. Hall is the president of Hughes Lang Corp., a Canadian mineral exploration, development and management company which is an affiliate of Phoenix. Knight is a partner of Lang Michener, a firm of barristers and solicitors in Toronto. Birkenshaw will also become the company's chairman of the board and chief executive officer, and Steven Manz and Michael Gross, Phoenix designees, will become president and chief financial officer and vice president- operations, respectively. Accordingly, Phoenix designees will constitute a majority of the Atlas board of directors and will be the principal executive officers of Atlas. Phoenix will own Warrants to purchase 1,250,000 shares of Atlas Common Stock. Phoenix and its affiliate which is expected to purchase the Debenture will be in a position to acquire shares of Atlas Common Stock upon exercise of Warrants and as interest on and upon conversion of the Debenture. Consequently, Phoenix may be deemed to control Atlas upon completion of the proposed transaction.
 In reliance on the New York Stock Exchange exception for stockholder approval, the company is mailing to stockholders a letter which advises them of the proposed transaction and of the company's intention to conclude the transaction on or about Sept. 20, 1993, without seeking approval of the stockholders.
 -0- 9/3/93
 /CONTACT: Robbin A. Lee at Atlas, 303-825-1200/

CO: Atlas Corp.; Phoenix Financial Holdings Inc. ST: Colorado IN: MNG SU: TNM

MC -- DV004 -- 8910 09/03/93 15:08 EDT
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Publication:PR Newswire
Date:Sep 3, 1993

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