Toronto-based Lifesciences Capital Corp. has signed a letter of intent to purchase all the issued and outstanding shares of Bio-Extraction Ltd., whose technology can extract mineral oils from such industrial materials as metal grinding sludge and swarf, metal filings and turnings covered in industrial lubricants. The purchase price is Canadian $14 million.
Bio-Extraction developed and is commercializing a proprietary extraction technology, which it then uses to extract various active ingredients from organic and inorganic materials, for industrial customers. Bio-Extraction has an office in Prince Edward Island, Canada, and its main office is in Toronto.
Tests performed on metal swarf showed more than 99 percent efficiency on separation of the oil and all oil soluable components from the metal when cleaned using Bio-Extractions technology, the company said. The contaminants level in the metal filings, post extraction, was 0.02 percent, which allows recycling of the metal filings back into manufacture of metal alloys. The company said the oil recovered is of high enough quality to be reused as lubricating oil in metal grinding and machining processes.
Bio-Extractions technology uses patented, biodegradable, non-flammable solvents. The company plans to build and operate commercial scale units close to feedstock providers. The company will perform extractions under contract with customers on a fee-for-volume or toll processing basis. They will initially focus on the North American market with a gradual expansion to Europe and South America.
Under the terms of the letter of intent, the aggregate purchase price of Canadian $14 million will occur through issuing of 46.7 million Lifesciences common shares in exchange for all of the issued and outstanding Bio-Extraction shares. Closing of the transaction is conditioned on regulatory approval and approval by each companys board of directors and shareholders.