Anaconda Mining Inc. and New Island Resources Inc. Announce Signing of Arrangement Agreement
December 10 2010 - 6:30AM
PR Newswire (Canada)
TORONTO AND ST. JOHN'S', Dec. 10 /CNW/ -- TORONTO AND ST. JOHN'S,
Dec. 10 /CNW/ - Anaconda Mining Inc. ("Anaconda") (TSX: ANX) and
New Island Resources Inc. ("New Island") (TSXV: NIS) are pleased to
announce they have entered into an arrangement agreement (the
"Arrangement Agreement") in connection with their previously
announced transaction, whereby Anaconda will acquire New Island's
interest in the Pine Cove Mine and Mill. The Transaction will be
structured as a Plan of Arrangement under the Business Corporations
Act (Alberta) between Anaconda and New Island. Highlights of the
Transaction The Arrangement will result, through a series of
transactions, in New Island selling to Anaconda all of its interest
in the Pine Cove Mine and Mill in exchange for common shares in
Anaconda (each, an "Anaconda Share") on the basis of a share
exchange ratio of 0.45 of an Anaconda Share for each one common
share of New Island (each, a "New Island Shares"). New Island
will then immediately distribute the Anaconda Shares to its
shareholders (other than Anaconda) by way of a return of
capital. Former shareholders of New Island (the "Tendered New
Island Shareholders") who tendered their shares in New Island (the
"Tendered New Island Shares") to Anaconda pursuant to Anaconda's
takeover bid offer in the summer of 2010 (the "Offer") and received
0.42 of an Anaconda Share for each one New Island Share they
tendered, will have issued to them by Anaconda an additional 0.03
of an Anaconda Share for each one New Island Share they
tendered. In addition, pursuant to the Arrangement, Anaconda
will return to the Tendered New Island Shareholders the New Island
Shares it acquired from them pursuant to the Offer. Board
Recommendation The Arrangement has been unanimously approved by the
boards of directors of both Anaconda and New Island and will be
subject to customary conditions, including a favourable vote of 66
2/3% of the New Island common shares voted at a special meeting of
shareholders called to approve the transaction and the receipt of
court and necessary regulatory approvals. In addition, the
Arrangement resolution must be approved by a simple majority of the
votes cast by the minority shareholders of New Island. The board of
directors of New Island unanimously recommends that holders of New
Island Shares vote in favour of the transaction. The Arrangement
Agreement includes a commitment by New Island not to solicit or
initiate discussions concerning alternative transactions, including
the acquisition or sale of material assets or subsidiaries of New
Island. Anaconda and New Island have each agreed to pay to the
other a break fee of C$300,000 in certain circumstances. New Island
has also granted Anaconda the right to match competing offers. In
addition to the approximate 49.97% ownership of New Island acquired
by Anaconda pursuant to the Offer, holders of approximately 12.82%
of the outstanding New Island shares, which includes all directors
and officers of New Island, have agreed to vote in favour of the
Arrangement. Advisors and Fairness Opinions Salman Partners Inc.
were engaged by New Island as a financial advisor to provide
financial advice to the New Island board of directors and its
opinion as to the fairness, from a financial point of view, of the
consideration to be received by the New Island Shareholders
pursuant to the Arrangement. The fairness opinion delivered
by Salman Partners states that, as of the date of their opinion and
subject to and based on the various considerations referred to in
their opinion, the consideration to be received by New Island
Shareholders pursuant to the Arrangement is fair, from a financial
point of view, to New Island Shareholders. Cassels Brock &
Blackwell LLP is acting as external legal counsel to Anaconda and
Cox & Palmer is acting as external legal counsel to New Island.
Closing The Arrangement is subject to New Island obtaining the
required shareholder approval at a special meeting of its
shareholders and to the receipt of court and all necessary
regulatory approvals. An management information circular for the
special shareholders meeting of New Island is expected to be mailed
by December 21, 2010 and New Island will hold the special meeting
to approve the Arrangement on January 11, 2011. The Arrangement is
scheduled to close shortly thereafter. The record date for the
special meeting has been fixed as December 17, 2010. About Anaconda
Mining Inc. Anaconda is a Toronto, Canada-based mining and
exploration company focused on operating the Pine Cove gold mine
located near Baie Verte in Newfoundland, Canada and, with its joint
venture partner, Inversiones SBX Limitada, advancing the
development and exploration of its iron ore portfolio in Chile.
Additional information concerning Anaconda may be obtained on
Anaconda's website at: www.anacondamining.com or from the System
for Electronic Document Analysis and Retrieval ("SEDAR") website
at: www.sedar.com under Anaconda's profile. About New Island
Resources Inc. New Island is a diversified junior exploration
company holding gold and base metal properties in the Province of
Newfoundland and Labrador. New Island has entered into an agreement
for the sale of its interest in the gold mine and mill project at
Pine Cove in central Newfoundland. Additional information
concerning this sale and New Island may be obtained on New Island's
website at: www.newislandresources.com or from the SEDAR website
at: www.sedar.com under New Island's profile. Cautionary Notice:
This news release contains "forward-looking information" within the
meaning of applicable Canadian securities legislation.
Forward-looking information includes, but is not limited to,
information concerning the proposed arrangement between Anaconda
and New Island and matters relating thereto. Generally,
forward-looking information can be identified by the use of
forward-looking terminology such as "plans", "expects", or "does
not expect", "is expected", "budget", "scheduled", "estimates",
"forecasts", "intends", "anticipates", or "does not anticipate", or
"believes" or variations of such words and phrases or statements
that certain actions, events or results "may", "could", "would",
"might", or "will be taken", "occur", or "be achieved".
Forward-looking information is based on the opinions and estimates
of management at the date the information is made, and is based on
a number of assumptions and subject to a variety of risks and
uncertainties and other factors that could cause actual events or
results to differ materially from those projected in the
forward-looking information. Assumptions upon which such
forward-looking information is based include, without limitation,
that the shareholders of New Island will approve the transaction,
that all required third party regulatory and governmental approvals
to the transaction will be obtained and all other conditions to
completion of the transaction will be satisfied or waived. Many of
these assumptions are based on factors and events that are not
within the control of Anaconda or New Island and there is no
assurance they will prove to be correct. Factors that could cause
actual results to vary materially from results anticipated by such
forward-looking information include changes in market conditions,
variations in ore grade or recovery rates, fluctuating metal
prices, changes in project parameters, the possibility of project
cost overruns or unanticipated costs and expenses, labour disputes
and other risks of the mining industry, failure of plant, equipment
or processes to operate as anticipated, as well as those risk
factors discussed in Anaconda's Annual Information Form for the
year ended December 31, 2009 available at www.sedar.com and New
Island's Management Information Circular, a copy of which will be
available on www.sedar.com. Although Anaconda and New Island have
attempted to identify important factors that could cause actual
actions, events or results to differ materially from those
described in forward-looking information, there may be other
factors that cause actions, events or results not to be
anticipated, estimated or intended. There can be no assurance that
forward-looking information will prove to be accurate, as actual
results and future events could differ materially from those
anticipated in such information. Anaconda and New Island undertake
no obligation to update forward-looking information if
circumstances or management's estimates or opinions should change
except as required by applicable securities laws. The reader is
cautioned not to place undue reliance on forward-looking
information. This news release and the information contained herein
does not constitute an offer of securities for sale in the United
States and securities may not be offered or sold in the United
States absent registration or exemption from registration. "Neither
the TSX Venture Exchange nor its Regulation Services Provider (as
that term is defined in the policies of the TSX Venture Exchange)
accepts responsibility for the adequacy or accuracy of this
release". To view this news release in HTML formatting, please use
the following URL:
http://www.newswire.ca/en/releases/archive/December2010/10/c4192.html
table class="cnwBorderedTable" border="1" cellspacing="0"tr
valign="top"td align="left"bAnaconda Mining Inc./bbr/ Dustin
Angelobr/ President and CEObr/ Tel: (647) 260-1248br/ Email: a
href="dangelo@anacondamining.com"dangelo@anacondamining.com/abr/
Website: a
href="http://www.anacondamining.com"www.anacondamining.com/a/td td
align="left"bNew Island Resources Inc./bbr/ Harold Warehambr/
Presidentbr/ Tel: (709) 576-7711br/ Email: a
href="info@newislandresources.com"info@newislandresources.com/abr/
Website: a
href="http://www.newislandresources.com"www.newislandresources.com/a/td/tr/table
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