|
RENO,
Nevada, PRNewswire/ -- Lou Schnur, a major shareholder
of Altair Nanotechnologies, Inc. (NASDAQ:ALTI) , has
called on Altair's directors to instruct management
to immediately sell or mothball its chronically unprofitable
mining operations and focus exclusively on
nanotechnology opportunities.
Altair is a company engaged in developing nanomaterials,
titanium dioxide pigment technology, and materials
science focused on nanostructures.
Schnur has filed a Schedule 13D with the Securities
and Exchange Commission outlining generally the views
expressed in this release.
Schnur, a CPA, longstanding Altair investor, and 9.9%
beneficial owner of Altair's outstanding stock and
warrants, said Altair's mining operations appear to
have generated economic losses of $30 million from
1973 through 2003. Also, Schnur criticized the proposed
action by Altair to spin off the mining operations
as a further distraction and waste of corporate assets.
Schnur said, "The continuing costs to maintain
mining personnel and operations, together with attendant
legal, accounting and shareholder solicitation costs
necessary to implement a spin-off, are economic losers.
The assets are carried on Altair's books at zero value,
have never produced significant revenues, much less
profits, and they should either be sold or mothballed
quickly."
Schnur said he supports Altair's December 19, 2003
announcement of a restructuring program whereby the
two development stage mining projects would be terminated,
so that Altair could focus 100% of its personnel and
other resources on its most promising business enterprise,
the Reno, Nevada Materials Nanotechnology Division.
But he says that a March 16, 2004 Altair announcement
is contradictory to the stated goals of the restructuring
in that there would be a continued focus on mining
activities. That release states in part:
"Altair plans to distribute (or spin off)
to its shareholders the capital stock of a subsidiary
holding the assets of the current Mineral Recovery
Systems (MRS) division. Altair intends to solicit
shareholder approval for the spin off and complete
the filings necessary to make MRS a reporting company.
MRS will hold the rights to the exploration-stage
mineral deposit in Camden, Tennessee, the ownership
of the Altair centrifugal jig and related intellectual
property for agglomeration of titanium dioxide.
Dr. William P. Long will resign his position as
Chief Executive Officer and member of Altair's board
of directors as of May 1, 2004. Dr. Long is expected
to serve as the President of MRS ... "
Altair's SEC report on Form 10-K for the fiscal year
ended December 31, 2003 disclosed aggregate losses
of $17.6 million, by subsidiaries, relating to the
centrifugal jig and the Tennessee mining projects.
Schnur said he believes the reporting of "subsidiaries
losses," as being indicative of total mining
losses, is understated and misleading.
Schnur also said, "After reviewing the financial
statements in the SEC filings, and as an active shareholder
(and a CPA, formerly employed by Price Waterhouse
& Co.), it is my opinion that a more realistic
economic assessment of Altair's $46 million loss,
from inception in 1973 to December 31, 2003 (30 years)
is:
Mining development projects division - 30 years $30
million
Reno materials/nanotech division - 3 years $16 million
Altair's total loss from 1973 - December 31, 2003
$46 million."
Schnur
said he believes shareholder value will be maximized
by the immediate termination of mining personnel and
of all controllable mining expenditures, and the disposal
of the mining projects by public auction, prior to
December 31, 2004. The auction should be advertised
in "The Northern Miner," with project descriptions
mailed to potential interested companies and investors.
Altair alumni, suppliers, business prospects and others
would have equal opportunity in a public auction.
A definitive, comprehensive disposal of the mining
projects will bring closure to a long-term, failed
business venture (and to Altair's team of mining directors
and managers), maximize Altair's chances for commercial
success, and hopefully set the stage for a long overdue
return on investments made by Altair shareholders,
Schnur said.
To explain his reasoning in estimating Altair's mining
losses, Schnur noted that Altair's only business until
November 1999 was mining, and that it did not have
significant nanotech expenses until 2001. In November
1999, Altair purchased certain technology assets from
BHP Minerals International, Inc. (BHP), including,
for a one-year period, the services of certain BHP
personnel involved in the development of the acquired
technology. Accordingly, Altair did not incur salary
expenses for the technology operation from November
15, 1999 through November 15, 2000, since these expenses
($1,535,985) were part of the total $9,625,560 purchase
price Altair paid BHP.
Altair reported in its Form 10-K for 2000 that it
had accumulated deficits during the development stage
of $21,606,378, virtually all of which, Schnur says,
was attributable to mining.
As to years following 2000, Altair reported in its
annual report for 2003 that "management views
the company as being three business segments: Nanomaterials
and Titanium Dioxide Pigment Technology, Tennessee
Mineral Property, and the Jig." The following
"Loss from Operations" was also reported:
Unallocated Tennessee Jig Mining Total
2003 $2,778,885 $155,709 $27,729 $183,438
2002 1,871,953 598,977 2,929,010 3,527,987
2001 2,006,198 930,777 300,913 1,231,690
TOTALS $6,657,036(B) $1,685,463 $3,257,652 $4,943,115(A)
Mining Deficits from April 9, 1973 through December
31, 2000 $21,606,378
Mining Deficits from 2001 through 2003 (A) 4,943,115
Estimated allocation of one-half of the $6,657,036
"unallocated expense" to the Tennessee Mineral
Property
and the Jig. (B) 3,328,518
Actual Mining Loss from inception through 2003 $29,878,011
Together with the Reno building and cash realized
from the exercise of warrants (as a result of investor
enthusiasm for Altair's Nanotech Division), the nanotech
assets are the only significant assets on the December
31, 2003 Balance Sheet. The mining projects were written
off. Schnur said he believes that Altair should have
established a "Reserve for Loss on Disposal of
Mining Projects" at December 31, 2003.
Schnur noted that the President's Message in Altair's
2000 annual report stated " ... the Camden titanium
deposit, with its tremendous resource value, remains
the financial underpinning of the company. We have
continued with our deliberate development of the property
as the world capacity for extraction of titanium mineral
resources has continued to decline."
"After $30 million of losses, and diminished
odds of obtaining necessary mining permits, as well
as a viable operating partner," Schnur said,
"it is time to cut the mining loss and give 100%
to Materials/Nanotech. In my opinion, the losses actually
attributable to the mining operations are greater
than the amounts that have been reported."
All of Altair's directors and senior management were
mining personnel until Rudi Moerck was hired in March
2002, a move Schnur supports. The mining division
had offices, in Cody, Wyoming and Reno, Nevada (complete
with jig). The Tennessee pilot plant and tailings
pond were constructed and operated in 2000-2001. The
BHP purchase was mostly paid from $8,904,029 received
for common stock sold in 2000 (at an average price
of $2.36). Altair's proceeds from the Doral 18 LLC
loan provided very little net cash to Altair; the
loan carried a very high interest rate; and the loan
resulted in significant dilution since warrants were
issued as part of the loan, and significant repayments
were made in common stock, at historically low prices.
Schnur said that four months after the December 2003
restructuring announcement, Altair continues the mining
payroll, lease payments to Tennessee landowners, engineering
support for the jig in Africa, maintenance and environmental
exposure for the pilot plant and tailings pond, an
office in Cody, etc. Moreover, the spin-off might
generate another $500,000 of expenses to be borne
by Altair. Shareholders should demand that Altair
directors order the immediate termination of this
wasteful spending.
This release is not intended, and does not constitute
a solicitation of proxies by Schnur or any other person
or group. Instead, in the interest of open shareholder
communications, and in accordance with applicable
SEC rules, it is intended to promote open communication
among all shareholders concerning their views on the
policies and decisions of Altair's management.
Source: Lou Schnur
CONTACT: David Margulies, +1-214-368-0909
or +1-800-710-5292, for Lou Schnur
|
