Extension of Offer to Minera Andes
February 13 2009 - 2:00AM
UK Regulatory
TIDMHOC
RNS Number : 2629N
Hochschild Mining PLC
13 February 2009
12 February 2009
Hochschild Mining extends the deadline of its offer to Minera Andes
Hochschild announces that, further to its press release of 9 February 2009, it
has agreed to extend the deadline of its proposals to the Board of Minera Andes
Inc ("MAI"), to purchase either the whole company or MAI's 49% interest in
Minera Santa Cruz, the joint venture company owned by Hochschild and MAI. The
offer is now open for acceptance until 10pm GMT on 13 February 2009. The terms
of the offer remain the same and are detailed below.
In addition to its short-term bridge financing to Minera Santa Cruz and MAI,
Hochschild has also offered additional financial relief to MAI, should MAI be
prepared to proceed with either of the proposals.
As announced in its press release of 2 February 2008, MAI requires funding to
meet its financial obligation under a bank loan as well as to cover a cash call
of US$11.3 million by Minera Santa Cruz which will be used to finance the cash
needs of the San Jos� project.
The cash call was required from both Hochschild and MAI to cover a cash flow
deficit created by (i) a furnace problem at San Jos� that impacted production
and thus cash flow for several days (ii) a delay in ramping up the plant to the
expanded capacity of 1,500 tpd (iii) a delay in the reimbursement of VAT
expenses by the Argentinean Government and (iv) the significant decrease in
precious metals prices in the last quarter of 2008. Hochschild has already made
its cash contribution and MAI now has until 3 March 2009 to contribute its share
of the funding.
Notes to editors
On 9 February 2009 MAI announced a C$40.0 million private placement with Robert
R. McEwen at a price of C$0.33 per share. Following this, Hochschild Mining made
an announcement to inform MAI shareholders that, on 6 February 2009, the
following firm proposals were made to the Special Committee of the Board of
Directors of MAI. These firm proposals, shown below, will now expire at 10pm GMT
on 13 February 2009.
"A) Hochschild would acquire all of the outstanding common shares of MAI
through a share transaction (including shares issuable pursuant to outstanding
MAI options (the "MAI Shares")) by way of a Plan of Arrangement under the
Business Corporations Act (Alberta) (the "Share Transaction"). Hochschild's
offer of 0.22 shares of Hochschild for each share of MAI held, which at the
closing price on 5 February 2009, implies a value of US$0.50 (C$0.62) for each
MAI Share representing a 100% premium. The terms of this proposal would also
provide for appropriate adjustments to be made to the terms of MAI warrants held
on the date of the Share Transaction; or
B) Hochschild would acquire MAI's 49% ownership interest in San Jos� for a cash
consideration equal to US$70 million. MAI would retain Los Azules and all other
exploration properties. The purchase price represents a cash consideration of
approximately C$0.45 per MAI share."
In addition, Hochschild offered to provide Minera Andes an extra ten business
days to contribute its pro-rata portion of the cash call due on 17 February, as
well as offering short-term bridge financing to Minera Santa Cruz. This period
of time was granted in order to allow Minera Andes the time necessary to obtain
financing to meet the cash call and assess the proposals described above.
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| Enquiries: | | |
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| Hochschild | | + 44 |
| Mining plc | | (0)20 |
| Isabel | | 7907 2934 |
| L�tgendorf | | |
| Head of | | |
| Investor | | |
| Relations | | |
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| Ignacio | | + 511 |
| Rosado | | 437 6007 |
| Chief | | |
| Financial | | |
| Officer | | |
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| Finsbury | | + 44 |
| Robin | | (0)20 |
| Walker | | 7251 3801 |
| Public | | |
| Relations | | |
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About Hochschild Mining plc:
Hochschild Mining plc is a leading precious metals company listed on the London
Stock Exchange (HOCM.L for Reuters / HOC LN for Bloomberg) with a primary focus
on the exploration, mining, processing and sale of silver and gold. Hochschild
has over forty years experience in the mining of precious metal epithermal vein
deposits and currently operates five underground epithermal vein mines, four
located in southern Peru, one in southern Argentina and one open pit mine in
northern Mexico. Hochschild also has over sixteen long-term prospects throughout
the Americas.
Certain statements in this announcement are or may be forward looking statements
regarding Hochschild Mining plc's financial position and results, business
strategy, production, plans and objectives. By their nature, all forward-looking
statements involve risk and uncertainty because they relate to future events and
circumstances which are beyond the Group's control. As a result, the Group's
actual future financial condition, performance and results may differ materially
from the plans, goals and expectations set forth in such forward-looking
statements. Except as required by applicable law or regulation, the Group does
not undertake any obligation to update or change any forward-looking statements
contained in this announcement or any other forward-looking statement it may
make.
This information is provided by RNS
The company news service from the London Stock Exchange
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