TORONTO, March 25, 2013 /CNW/ - Dacha Strategic Metals Inc. (TSX-V: DSM) ("Dacha") today announced the following update regarding its business and operations.
As previously disclosed, since the reconstitution of Dacha's board on November 28, 2012, Dacha has been reviewing its opportunities and prospects to create shareholder value from both its existing metals inventories and its rare earth metals business going forward. That review, which is continuing, also includes an assessment of Dacha's overall corporate strategy and strategic and other alternatives available to it, all with a view to ensuring that Dacha's actions going forward maximize long-term shareholder value.
As part of that review, Dacha has also been actively pursuing alternative strategies to fund the payment of the previously disclosed Cdn. $4.85 million that is owed to certain former executives and consultants of Dacha (the "Former Executives") in respect of their change of control arrangements (the "Termination Payments").
Dacha has now completed sales of an aggregate of 14,000 kilograms of dysprosium oxide that was previously warehoused in Korea for gross proceeds of approximately U.S. $5.6 million. The proceeds from these sales will be used, as to Cdn. $4.85 million, to fully pay the Termination Payments prior to March 28, 2013, with the balance being applied towards other payables owing by Dacha and/or for general working capital. Upon the payment of the said Cdn. $4.85 million to the Former Executives, no further amount will be owed to them by Dacha or its subsidiaries and the security arrangements implemented in connection with the Termination Payments will be fully discharged.As part of Dacha's ongoing strategic review, Dacha continues to evaluate Dacha's inventory position and may make future purchases or sales of rare earth metals depending upon market conditions.