Inter-Citic Minerals Inc.
TSX : ICI

Inter-Citic Minerals Inc.

April 20, 2010 08:38 ET

Inter-Citic Minerals Inc. Announces Private Placement Involving Zijin Mining Group Co., Ltd.

Zijin Mining Group Co., Ltd. Becomes Inter-Citic's Largest Stockholder

TORONTO, ONTARIO--(Marketwire - April 20, 2010) -

NOT FOR DISSEMINATION IN THE UNITED STATES OR FOR RELEASE TO U.S. NEWSWIRE SERVICES

Further to its press release dated April 15, 2010, Inter-Citic Minerals Inc. (TSX:ICI) ("Inter-Citic" or "the Company") is pleased to announce the closing of the C$18.56 million strategic investment by Zijin Mining Group Co., Ltd. ("Zijin"), China's largest gold producer.

Pursuant to an agreement among the Company, Zijin and ICBC Credit Suisse Asset Management Company Limited, a Chinese Qualified Domestic Institutional Investor (the "Agreement"), 16,000,000 common shares of the Company ("Shares") were issued at a price of C$1.16 per share for gross proceeds of C$18.56 million. No commissions or finders fees were paid in relation to this private placement. 

Under the terms of the Agreement, Zijin has a participation right that will enable it to maintain an equity level of up to 19.9% of the outstanding common shares of Inter-Citic by participating in future equity financings of Inter-Citic until the earlier of the date on which Zijin holds less than 19% of the outstanding common shares and 42 months from April 19, 2010 (the "Participation Period"). During the Participation Period, Inter-Citic has also agreed to nominate one individual, on behalf of Zijin, for election to Inter-Citic's board of directors (the "Board"). The Agreement also provides that Zijin will not, for 24 months from April 19, 2010 (subject to a change of control or a change of management), vote against management in respect of certain matters set out in the Agreement. 

All Shares issued in connection with the private placement are subject to a four month statutory hold period under applicable securities legislation. In addition, for 12 months from April 19, 2010, Zijin shall not without the prior written consent of the Company sell, transfer, dispose of or otherwise trade, or lend, encumber, transfer or assign for the purpose of short selling, any Shares other than in connection with certain change of control transactions. Zijin has also agreed, for a period of 24 months from April 19, 2010, to a standstill provision under which it will not, among other things, make any offer to acquire securities of Inter-Citic without the consent of the Inter-Citic Board. 

Together with shares previously purchased by Zijin, it now owns 20,163,300 common shares of Inter-Citic, representing 19.15% of the issued and outstanding shares of the Company.

The net proceeds of the offering will be used to advance Inter-Citic's Dachang gold project in China (as described in the Company's Annual Information Form dated February 23, 2010), and for general corporate purposes.

Zijin is the largest owner of metal mineral resources, the largest gold producer, the third largest copper producer and one of six major zinc producers in the People's Republic of China. Zijin has operations in more than 20 provinces in China and in seven other countries. Zijin's flagship asset is the Zijinshan Gold-Copper Mine, which is the largest open pit gold mine in China. Zijin is listed on the Hong Kong Stock Exchange (HKSE: stock name: Zijin Mining, stock code: 2899.HK) and the Shanghai Stock Exchange (SSE: stock name: Zijin Mining, stock code: 601899) with a market capitalization of approximately $20 billion.

ICBC Credit Suisse Asset Management Company Limited, an asset management joint venture registered under the laws of the People's Republic of China, was appointed as asset investment manager pursuant to an asset management agreement between Zijin, ICBC Credit Suisse Asset Management Company Limited and an asset custodian.

The securities being offered have not been, nor will they be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States or to, or for the account or benefit of, U.S. persons absent registration or an applicable exemption from registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any state in which such offer, solicitation or sale would be unlawful.

On Behalf of the Board:

James J. Moore, President & CEO

ABOUT INTER-CITIC:

Toronto-based Inter-Citic Minerals Inc. is an exploration and development company with property in the People's Republic of China, including its Dachang Gold Project in Qinghai Province. Inter-Citic is listed on the TSX under the symbol ICI. Inter-Citic's website is www.inter-citic.com.

Investors are encouraged to review "Risk Factors" associated with the Dachang project as outlined in the Company's 2009 Financial Statements and Annual Information Form, along with updates, available on the SEDAR website at www.sedar.com. The statements herein that are not historical facts are forward-looking statements. These statements address future events and conditions and so involve inherent risks and uncertainties, as disclosed under the heading "Risk Factors" in the company's periodic filings with Canadian securities regulators. Actual results could differ from those currently projected. The Company does not assume the obligation to update any forward-looking statement.

The TSX has not reviewed and does not accept responsibility for the adequacy or accuracy of the content of this news release.

Contact Information

  • Inter-Citic Minerals Inc.
    Stephen Lautens
    Vice President, Corporate Communications
    (905) 479-5072 x 227
    stephen@inter-citic.com