- Dominion Water Reserves (DWR) has entered into a definitive share purchase agreement to acquire a subsidiary of Aquanor
- In August, the company agreed to acquire 11973002 Canada, to gain full ownership of the St-Joseph de Coleraine water source
- As agreed, Dominion Water will pay 714,286 of its common shares and an aggregate C$400,000 in consideration for the acquisition
- The company plans to eventually enter a definitive water sale contract with Aquanor, which will cover the next 25 years
- Dominion Water Reserves (DWR) is down eight per cent and is currently trading for $0.12 per share
Dominion Water Reserves (DWR) has entered into a definitive share purchase agreement to acquire a subsidiary of Aquanor.
Earlier this year, in August of 2020, the company announced that it had entered into a letter of intent with Aquanor. Under the LOI, Dominion Water agreed to acquire Aquanor’s subsidiary, 11973002 Canada, in order to gain full ownership of the St-Joseph de Coleraine water source.
This definitive share purchase agreement has cemented the terms of the LOI, allowing the transaction to move forward. As previously agreed, Dominion Water will pay 714,286 of its common shares and an aggregate C$400,000 to Aquanor as consideration.
The 714,286 of common shares in Dominion Water, at $0.35 per share, will be worth an aggregate $250,000. The $400,000 in cash will be paid to Aquanor in three separate instalments.
The first instalment, a $150,000 deposit, has already been paid concurrently with the signing of the definitive agreement. Another payment of $150,000 will be paid to Aquanor at the closing of the acquisition, with the final $100,000 being paid on March 1, 2021.
The closing of the acquisition is subject to various conditions, including the two companies entering a definitive water sale contract. Dominion Water will enter this contract with Aquanor, in order to sell the specialised water which comes from the St-Joseph de Coleraine water source.
The contract will cover the next 25 years, with the amount paid increasing in small increments. In the first five years, the contract will demand 0.5 cents per litre, before rising to one cent per litre for the following five years. The rate will increase again to 1.5 cents per litre for the subsequent five years, before finally settling at two cents per litre for the following ten years.
After 25 years, the price per litre will be subject to an annual increase, based on the Canadian consumer price index.
Dominion Water’s CEO, Andrew Lindzon, said the company is pleased to have entered into the agreement with Aquanor.
“We have a full end-to-end strategy for packaging and distributing this prized and highly specialised water. Fiji Water became a global iconic brand because of its pure and mineral rich water.
“We intend to grow North America’s only naturally produced 13ppm Silicium waters source in a similar fashion through a health and wellness theme,” he said.
Despite cementing the acquisition, Dominion Water Reserves (DWR) is down eight per cent and is trading at $0.12 per share at 10:12am EDT.