Anglesey Mining PLC - Trading Statement - Labrador Iron financing increased to C$35 million (£22.6 million)
Anglesey Mining plc LSE:AYM
8 March 2010
Labrador Iron financing increased to C$35 million (£22.6 million)
Anglesey grants options over LIM shares for up to £2.9 million
Anglesey Mining plc is pleased to announce that its 50% owned associate
Labrador Iron Mines (LIM) arranged a $C35 million bought deal financing on
Friday 5 March 2010. This was in two stages the first of which was announced
by Anglesey on Friday, followed after the close of UK business by a $C10
million extension bringing the total to be raised to $C35 million. The
complete financing involves the issue of 5,406,000 LIM common shares at a
price of $C5.55 each together with 764,000 tax flow-through shares at
C$6.65 each.
In parallel with this increased LIM financing, Anglesey has granted an over-
allotment option to the underwriters to purchase up to 810,900 shares from
Anglesey's current LIM holding at $C5.55 each and if exercised in full this
will provide Anglesey with gross proceeds of C$4.5 million (£2.9
million).
The bought deal is with a syndicate of Canadian underwriters led by Canaccord
Financial Ltd. The increase in the offer is of 1,766,000 common shares at C$5.55
per share from LIM's treasury, subject to receipt by LIM of all necessary
regulatory approvals. Under the amended terms of the offering the underwriters
have agreed to purchase an aggregate of 6,166,000 LIM shares for anticipated
total gross proceeds of C$35,057,300 (£22.6 million). LIM plans to use the net
proceeds from the offering for exploration and development of its mineral
projects, and for general corporate and working capital purposes.
In addition, Anglesey has increased the option granted to the underwriters to
purchase LIM common shares from those already owned by Anglesey, up to an
aggregate of 810,900 shares for the purpose of covering the underwriters' over-
allocation position in respect of the LIM bought deal. These shares represent
15% of the number of new shares being issued by LIM (excluding flow-through
shares) and 4.4% of Anglesey's current holding in LIM of 18,600,000 shares.
Following the LIM financing this potential share sale by Anglesey would reduce
its holding in LIM by 1.9 percentage points.
The price for the LIM shares under option is C$5.55 per share, for gross
proceeds of up to C$4,500,495 (£2.9 million), The same terms and conditions as
in respect of the LIM issue apply and the option is exercisable at any time in
whole or in part up to 30 days after the date of the closing of the underwritten
offering.
The net proceeds from the sale of Anglesey's LIM shares will be used by Anglesey
for general corporate costs and working capital purposes.
Bill Hooley, Chief Executive of Anglesey said "We are very pleased that we are
able to join with our associate company in this financing that provides LIM with
additional capital to enable it to become a new force in the Canadian Iron ore
business and that at the same time, if the option is exercised, will enable
Anglesey to raise some necessary funding through the sale of a small portion of
its holding in LIM. We would expect that this new cash injection will be
sufficient for at least one year's requirements and that further sales of LIM
shares are not contemplated at this time."
Other terms and conditions including the filing of a short form prospectus in
Toronto are unchanged. The underwritten offer is expected to close on or about
25 March 2010. LIM has 37,203,951 common shares outstanding prior to the offer.
The Offering is being made pursuant to a short form prospectus to be filed in
the provinces of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, New
Brunswick, Nova Scotia, Prince Edward Island and Newfoundland and Labrador. The
Offered Securities will not be registered under the U.S. Securities Act of 1933,
as amended, and may not be offered or sold in the United States absent
registration or an applicable exemption from the registration requirements.
Labrador Iron Mines Holdings Limited (LIM)
LIM's Schefferville area project involves the exploration and development of
direct shipping iron ore deposits in western Labrador and north eastern Quebec
near Schefferville. LIM's properties are part of the historic Schefferville area
iron ore district where mining of adjacent deposits was previously carried out
by the Iron Ore Company of Canada from 1954 to 1982. LIM plans to mine its
deposits in varying stages, the first stage comprising the James and Redmond
deposits, which are located in Labrador in close proximity to existing
infrastructure. Subject to timely receipt of all permits and licences, iron ore
production is planned to commence in the summer of 2010.
About Anglesey Mining
Anglesey Mining plc is a UK based company listed on the London Stock Exchange
which currently holds 18,600,000 shares in Labrador Iron Mines Holdings Limited.
The company also holds the Parys Mountain base metals project with a
historical resource of 7.7 million tonnes at 9.3% combined copper, lead and zinc
in Anglesey, UK.
For further information contact
Bill Hooley, Chief Executive 01492-541981
Ian Cuthbertson, Finance Director 01248 361333
Emily Fenton/Charlie Geller, Conduit PR 020 7429 6666
The Labrador Iron Ore project, currently under active development, which is scheduled to produce direct shipping lump and sinter fine ores by mid-2010. This project is fully funded and has relatively low capital expenditure requirements. The major iron ore deposits comprised in the project were previously operated by the Iron Ore Company of Canada. Anglesey holds 50% of Labrador Iron Mines Holdings Limited(TSX:LIM) which is developing the project. See the Labrador Iron Mines Holdings website for further details.
