A group of BlackRock Metals shareholders applied to the court to be able to intervene in the process of the financial restructuring of the company and thus avoid losing their stake.
Winner World, BlackRock’s main shareholder with 46% of the shares outstanding, and a numbered company represented by former BlackRock Metals CEO Jean Rainville filed a motion to this effect in Superior Court on January 3.
“Our goal is to convene a meeting of BlackRock Metals shareholders so that we can have an explanation of the latest events”, explained Jean Rainville in an interview with Press. The 67-year-old Mr. Rainville acts as spokesperson for the shareholders of the mining company. He left his position at BlackRock Metals in 2018 when he went on semi-retirement.
PHOTO FRANÇOIS ROY, PRESS ARCHIVES
Jean Rainville, former President and Chief Executive Officer and spokesperson for the BlackRock Metals shareholders’ group
Two days before Christmas, BlackRock requested protection of the Companies’ Creditors Arrangement Act (LACC) because she didn’t have the money to pay off her major creditors.
Founded in 2008, BlackRock aims to produce iron, vanadium and titanium, essential minerals in the electrification of the economy and the reduction of greenhouse gas emissions.
The deposit is located near Chibougamau and the metallurgical complex is to be built at the port of Saguenay. BlackRock needs US $ 1.1 billion to move forward with its ambitious project, Controller Deloitte said in a statement.
BlackRock Metals is in dispute with its main unsecured creditor, Prosperity Materials Macao Commercial Offshore, to whom it owes US $ 40 million. Its main secured creditors are Investissement Québec and Orion Resource Partners. The junior owes them 90 million.
As part of the LACC, the government of Quebec and its partner Orion present an offer to purchase 100% of BlackRock Metals for an amount equal to the amount guaranteed to them. Such an offer, if approved by the court at the end of the process, would have the effect of washing out common shareholders like Winner World and Jean Rainville.
“Opportunistic and abusive behavior”
They, united in the group of shareholders of BlackRock Metals, reproach IQ for its “brutal conduct” in a formal notice sent on December 22 to Amyot Choquette, IQ, and Orion. They put it back in their motion served on January 3. They accuse the investor arm of the government of Quebec and its partner Orion of adopting “opportunistic and abusive behavior” by recalling their bridge loan of 90 million.
“The purpose of the procedure CCAA as it was filed is that Orion and IQ acquire the assets of the company at a very low price, ”they denounce in their request.
Also in their request, the plaintiffs assert that BlackRock Metals was on the verge of making progress in the financing of its mine. They report a pension fund that would have come forward to advance 200 million and a subsidy of 100 million from the federal government. It also appears that Orion and IQ also raised their hands to participate in the financial package.
Mr. Rainville said he was ill-equipped to estimate his losses if IQ and Orion’s initial draft screen in connection with the sale of BlackRock Metals were to go ahead. The shareholder consolidation request reports a current enterprise value varying between 175 and 350 million US. Such a valuation would give a value of between US $ 1 million and US $ 2 million to the 847,000 shares held by Mr. Rainville.
The next court hearing is scheduled for January 7.