Comstock Acquires and Retires Over 2.6 Million Common Shares
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Insights
The recent share repurchase and cancellation by Comstock Inc. is a strategic financial maneuver that directly impacts the company's capital structure. By reducing the number of outstanding shares, the company is effectively increasing the earnings per share (EPS), a move that can be seen as an attempt to enhance shareholder value. This action can be perceived as a signal of internal confidence in the long-term prospects of the company, suggesting management believes the shares were undervalued.
However, it is important to scrutinize the funding of the repurchase. The transaction involves a monthly installment payment plan, which implies a commitment of cash flows for the next year. Stakeholders should consider the impact of this cash outflow on the company's liquidity and whether it could have been allocated to other growth opportunities. Furthermore, the guarantee of LINICO's obligation by Comstock adds a layer of risk, as any default by LINICO could potentially impact Comstock's financials.
Comstock's focus on decarbonization technologies places it within the growing renewable energy sector. The repurchase of shares following the acquisition of LINICO indicates a consolidation strategy, possibly aimed at streamlining operations and assets under the Comstock umbrella. From a market perspective, such consolidation could be seen as a move to strengthen Comstock's position in the competitive landscape of renewable energy and technology.
Investors and competitors alike will be monitoring the company's ability to leverage LINICO's assets, particularly the Series Seed Preferred Shares in Green Li-Ion Pte. Ltd., which could be strategic in expanding Comstock's renewable energy portfolio. The success of integrating LINICO's assets and the performance of investments like Green Li-Ion will be critical in evaluating the long-term impact of this transaction on the company's market position.
Comstock's operational emphasis on systemic decarbonization through the conversion of natural resources into renewable energy products aligns with global trends towards sustainability and the energy transition. The reacquisition of shares from LINICO, an entity now wholly owned by Comstock, suggests a deeper integration of LINICO's technologies and resources into Comstock's business model. This could potentially enhance Comstock's capability to innovate and deliver on its decarbonization goals.
The environmental technology sector is highly dependent on research and development (R&D) and such corporate restructuring could free up resources to invest in R&D. However, the effectiveness of such investments in driving technological advancements and the subsequent commercial success of these innovations must be critically assessed. The impact of these changes on Comstock's environmental technology offerings could be substantial, influencing both the company's reputation as an innovator and its financial performance in the burgeoning green economy.
VIRGINIA CITY, Nev., Jan. 08, 2024 (GLOBE NEWSWIRE) -- Comstock Inc. (NYSE: LODE) (“Comstock” and the “Company”), an innovator of technologies that enables systemic decarbonization by efficiently converting under-utilized natural resources into renewable energy products, announced today that it has reacquired and cancelled 2,605,322 of its previously issued common shares held by LINICO Corporation (“LINICO”), and reduced Comstock’s outstanding shares to 115,256,759.
“We recently acquired the remaining interest in LINICO, providing the opportunity to reacquire and retire over 2.6 million common shares,” stated Corrado De Gasperis, Comstock’s Executive Chairman and Chief Executive Officer. “We are focusing on delivering shareholder value, and this represents an accretive transaction that increases our per share values.”
Previously, Comstock, LINICO and Aqua Metals, Inc. (“Aqua Metals”) entered into a Stock Redemption Agreement wherein Aqua Metals sold, and LINICO purchased, all of the remaining equity in LINICO in exchange for
Comstock Inc.
Comstock (NYSE: LODE) commercializes technologies that enable systemic decarbonization and accelerate the energy transition by efficiently converting under-utilized natural resources into renewable energy products, and by leveraging physics based artificial intelligence for more efficient and effective mineral and materials discovery. To learn more, please visit www.comstock.inc.
Forward-Looking Statements
This press release and any related calls or discussions may include forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, are forward-looking statements. The words “believe,” “expect,” “anticipate,” “estimate,” “project,” “plan,” “should,” “intend,” “may,” “will,” “would,” “potential” and similar expressions identify forward-looking statements but are not the exclusive means of doing so. Forward-looking statements include statements about matters such as: future market conditions; future explorations or acquisitions; future changes in our research, development and exploration activities; future financial, natural, and social gains; future prices and sales of, and demand for, our products and services; land entitlements and uses; permits; production capacity and operations; operating and overhead costs; future capital expenditures and their impact on us; operational and management changes (including changes in the Board of Directors); changes in business strategies, planning and tactics; future employment and contributions of personnel, including consultants; future land and asset sales; investments, acquisitions, joint ventures, strategic alliances, business combinations, operational, tax, financial and restructuring initiatives, including the nature, timing and accounting for restructuring charges, derivative assets and liabilities and the impact thereof; contingencies; litigation, administrative or arbitration proceedings; environmental compliance and changes in the regulatory environment; offerings, limitations on sales or offering of equity or debt securities, including asset sales and associated costs; business opportunities, growth rates, future working capital, needs, revenues, variable costs, throughput rates, operating expenses, debt levels, cash flows, margins, taxes and earnings. These statements are based on assumptions and assessments made by our management in light of their experience and their perception of historical and current trends, current conditions, possible future developments and other factors they believe to be appropriate. Forward-looking statements are not guarantees, representations or warranties and are subject to risks and uncertainties, many of which are unforeseeable and beyond our control and could cause actual results, developments, and business decisions to differ materially from those contemplated by such forward-looking statements. Some of those risks and uncertainties include the risk factors set forth in our filings with the SEC and the following: adverse effects of climate changes or natural disasters; adverse effects of global or regional pandemic disease spread or other crises; global economic and capital market uncertainties; the speculative nature of gold or mineral exploration, and lithium, nickel and cobalt recycling, including risks of diminishing quantities or grades of qualified resources; operational or technical difficulties in connection with exploration, metal recycling, processing or mining activities; costs, hazards and uncertainties associated with precious and other metal based activities, including environmentally friendly and economically enhancing clean mining and processing technologies, precious metal exploration, resource development, economic feasibility assessment and cash generating mineral production; costs, hazards and uncertainties associated with metal recycling, processing or mining activities; contests over our title to properties; potential dilution to our stockholders from our stock issuances, recapitalization and balance sheet restructuring activities; potential inability to comply with applicable government regulations or law; adoption of or changes in legislation or regulations adversely affecting our businesses; permitting constraints or delays; challenges to, or potential inability to, achieve the benefits of business opportunities that may be presented to, or pursued by, us, including those involving battery technology and efficacy, quantum computing and generative artificial intelligence supported advanced materials development, development of cellulosic technology in bio-fuels and related material production; commercialization of cellulosic technology in bio-fuels and generative artificial intelligence development services; ability to successfully identify, finance, complete and integrate acquisitions, joint ventures, strategic alliances, business combinations, asset sales, and investments that we may be party to in the future; changes in the United States or other monetary or fiscal policies or regulations; interruptions in our production capabilities due to capital constraints; equipment failures; fluctuation of prices for gold or certain other commodities (such as silver, zinc, lithium, nickel, cobalt, cyanide, water, diesel, gasoline and alternative fuels and electricity); changes in generally accepted accounting principles; adverse effects of war, mass shooting, terrorism and geopolitical events; potential inability to implement our business strategies; potential inability to grow revenues; potential inability to attract and retain key personnel; interruptions in delivery of critical supplies, equipment and raw materials due to credit or other limitations imposed by vendors; assertion of claims, lawsuits and proceedings against us; potential inability to satisfy debt and lease obligations; potential inability to maintain an effective system of internal controls over financial reporting; potential inability or failure to timely file periodic reports with the Securities and Exchange Commission; potential inability to list our securities on any securities exchange or market or maintain the listing of our securities; and work stoppages or other labor difficulties. Occurrence of such events or circumstances could have a material adverse effect on our business, financial condition, results of operations or cash flows, or the market price of our securities. All subsequent written and oral forward-looking statements by or attributable to us or persons acting on our behalf are expressly qualified in their entirety by these factors. Except as may be required by securities or other law, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Neither this press release nor any related calls or discussions constitutes an offer to sell, the solicitation of an offer to buy or a recommendation with respect to any securities of the Company, the fund, or any other issuer.
Contact Information:
For investor inquiries, contact: RB Milestone Group
Tel (203) 487-2759
ir@comstockinc.com
For media inquiries or questions, contact: Zach Spencer, Comstock Inc.
Tel (775) 847-7532
questions@comstockinc.com
Source: Comstock Inc.
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