20th Mar 2007 07:01
Aricom PLC20 March 2007 Press Release 20 March 2007 Aricom plc ("Aricom" or "the Group") IFC Proposes Equity Investment Aricom plc (AIM: TIO), the Anglo-Russian developer of mineral resources, todayannounces that it has agreed to a potential investment from the InternationalFinance Corporation ("IFC") of US$20m in newly issued shares with a matchingnumber of warrants. The investment proposal is subject to further duediligence, approval by IFC's Board and the execution of documentation; thetarget date for the investment is May 2007. Proposed Investment IFC would subscribe US$20m for new shares at a price per share equal to thelesser of UK£0.59 per share or the five day volume weighted average shares priceprior to the date of issue (the "Investment Price"). The proposed new shareswill be ordinary shares in Aricom ranking pari passu with all existing ordinaryshares then in issue. At the same time Aricom would grant IFC warrants tosubscribe for the same number of shares as they subscribe for at an exerciseprice with a 25% premium to the Investment Price. Following the date Aricomnotifies the IFC of cumulative gross revenue of US$40m, Aricom will be able torequire the IFC to exercise the warrants if the shares trade at a 60% premium tothe Investment Price in the two years following this date and at a 30% premiumto this price after two years. IFC is the private sector arm of The World Bank Group. IFC is a substantialprovider of finance to companies in Russia in a wide range of sectors, includingmining. Jay Hambro, Chief Executive, said: - "I am delighted that IFC is proposing to invest in the company as a sign oftheir support in what we are doing. As Aricom continues our extensivedevelopment programme the Group shall use these funds to expedite progress. Ibelieve that IFC's consideration of an investment at this stage is a great voteof confidence in the strength of both our current portfolio of projects and theGroup's ability to continue to bring further projects to fruition. As we expect to enter into the project finance market for the first time, itshould be encouraging for project lenders that one of the world's leaders inproject finance is considering becoming a shareholder. Following theinvestment, I also believe that shareholders would derive comfort fromco-investing alongside part of the World Bank group." Christopher Goss, Head, Business Development for Oil, Gas, Mining and Chemicals,the International Finance Corporation, said: - "We are very pleased to consider participating in Aricom's mining developmentsin Russia. We believe that the development of Aricom's assets will addsignificant value to both the communities surrounding the projects and to theAmur and Evreyskaya Autonomous Regions of Russia as a whole. We look forward toplaying an ongoing role in the development programme." - Ends - For further information:Aricom plcJay Hambro, Chief Executive Tel: +44 (0) 20 7201 8939 www.aricom.plc.uk AbchurchCharlie Jack/ George Parker Tel: +44 (0) 20 7398 7700 www.abchurch-group.com Canaccord AdamsChris Bowman Tel: +44 (0) 20 7050 6500 www.canaccordadams.com Notes to Editors Aricom plc is a leading developer of Russian metal and mining assets, focusingon iron ore and ilmenite production and delivery. The Company was establishedin September 2003 to develop projects, situated in the north west of the AmurRegion, in Russia's Far East. These projects are set to service the Chinese andRussian commodity market. Aricom currently operates three projects in the Amur region and the adjoiningJewish Autonomous Region. The Company's projects Kuranakh, K&S and Bolshoi Seymhave combined estimated reserves and resources of over one billion tonnes ofIron Ore and Ilmenite ores. The location of the Company's deposits offer asignificant logistical advantage being close to the Trans-Siberian-Express andthe Baikal-Amur Magistral railways. In 2005, 700 million tonnes of iron ore were shipped globally, of that 300million (43%) was shipped to China. It is currently estimated that China is oncourse to have imported 300 million tonnes of ore by the end of 2006 tofacilitate its demand for steel production. In June 2006, Aricom announced aMemorandum of Understanding with China's largest nonferrous metal companyAluminium Corporation of China ("Chinalco"), to co-operate in the design anddevelopment of a Titanium Sponge production plant in China. Aricom is headquartered in London, with a highly experienced board of directorscomposed of British and Russian citizens. The company's shares were admitted totrading on the AIM Market in December 2003 and trade under the symbol TIO.L. Forfurther information please visit www.aricom.plc.uk This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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