Ivanhoe Mines to Receive US$536 (C$529) Million From Rio Tinto's Exercise of Subscription Right
August 24 2011 - 4:31PM
Marketwired
Ivanhoe Mines' (TSX: IVN)(NYSE: IVN)(NASDAQ: IVN) Chief Executive
Officer Robert Friedland confirmed today that Rio Tinto has
exercised its subscription right to acquire an additional
27,896,570 common shares of Ivanhoe Mines.
The acquisition will generate total proceeds of C$529,476,898
for Ivanhoe Mines and raise Rio Tinto's interest in Ivanhoe Mines
from 46.5% to 48.5%. The price paid per share was C$18.98, the
five-day volume weighted average share price on the Toronto Stock
Exchange. The subscription right exercise was made in accordance
with terms of the December 2010 Heads of Agreement between Ivanhoe
Mines and Rio Tinto.
With the receipt of the proceeds from the subscription right,
Ivanhoe Mines' cash position, on a consolidated basis, will total
approximately US$1.7 billion.
Rio Tinto's maximum permitted level of ownership in Ivanhoe
Mines, attainable only through open-market purchases of common
shares, is capped at 49% until the current standstill limitation
expires on January 18, 2012.
Rio Tinto said in a news release today announcing its move that
the subscription for new shares "reinforces Rio Tinto's commitment
to the Oyu Tolgoi Project, which is a natural fit with its strategy
of focusing on cost-competitive, long-life assets with significant
growth potential."
Ivanhoe Mines owns 66% of the Oyu Tolgoi copper-gold-silver
project now under full-scale construction in southern Mongolia and
expected to begin initial production in 2012; the Government of
Mongolia owns the remaining 34%.
Rio Tinto's combined investment in Ivanhoe Mines since October
2006 will amount to more than US$4 billion through the purchase of
shares, the exercise of warrants and a converted debt facility.
About Ivanhoe Mines (www.ivanhoemines.com)
Ivanhoe Mines (TSX: IVN)(NYSE: IVN)(NASDAQ: IVN) is an
international mining company with operations focused in the Asia
Pacific region. Assets include the company's 66% interest in the
world-scale, Oyu Tolgoi copper-gold mine development project in
southern Mongolia; its 57% interest in Mongolian coal miner
SouthGobi Resources (TSX: SGQ)(HK: 1878); a 62% interest in Ivanhoe
Australia (TSX: IVA)(ASX: IVA), a
copper-gold-uranium-molybdenum-rhenium exploration and development
company; and a 50% interest in Altynalmas Gold, a private company
developing the Kyzyl Gold Project in Kazakhstan.
FORWARD-LOOKING STATEMENTS: This document includes
forward-looking statements regarding Ivanhoe Mines' plans.
Forward-looking statements include, but are not limited to,
statements concerning the development and expected start of initial
production at the Oyu Tolgoi Project. When used in this document,
the words such as "expected", "intend", "plan", "advance" and
similar expressions are forward-looking statements. Although
Ivanhoe Mines believes that its expectations reflected in these
forward-looking statements are reasonable, such statements involve
risks and uncertainties and no assurance can be given that actual
results will be consistent with these forward-looking statements.
Important factors that could cause actual results to differ from
these forward-looking statements are disclosed under the heading
"Risk Factors" and elsewhere in the corporation's periodic filings
with Canadian and US securities regulators.
Contacts: Ivanhoe Mines Ltd. Bill Trenaman Investors
+1.604.688.5755 Ivanhoe Mines Ltd. Bob Williamson Media
+1.604.331.9830 www.ivanhoemines.com
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