Mirabela Nickel Limited

Mirabela Nickel Limited

December 14, 2009 08:16 ET

Mirabela Announces Private Placement

PERTH, AUSTRALIA--(Marketwire - Dec. 14, 2009) -


Mirabela Nickel Limited (TSX:MNB)(ASX:MBN) ("Mirabela" or the "Company") announced today that it has entered into an agreement with GMP Securities L.P. ("GMP") pursuant to which GMP and a syndicate of underwriters including Dundee Securities Corporation have agreed to sell 5,500,000 special warrants (the "Special Warrants") principally in Canada and the United States, on a private placement basis, at a price of C$2.23 per Special Warrant for aggregate gross proceeds of C$12,265,000 (the "Canadian Placement"). The Special Warrants will convert into ordinary shares of the Company on a one for one basis, subject to conditions and exceptions described below. The issue price per Special Warrant was calculated as the Canadian dollar equivalent of A$2.30, the issue price under the Australian Placement, described below. The Canadian Placement is scheduled to close on or about January 8, 2010.

The Company has also completed a book build in respect of a private placement of approximately 16.4 million ordinary shares to investors outside of Canada, principally in Australia, at a price of A$2.30 per share for aggregate gross proceeds of approximately A$37.7 million (the "Australian Placement"). The Australian Placement will be allocated tomorrow morning Sydney time.

In addition, the Company has agreed to two director-related placements, namely approximately 1.7 million ordinary shares to Lancaster Park SA and approximately 0.4 million ordinary shares to Mr. Craig Burton, each at a price of A$2.30 per share (the "Director Placements"). In accordance with the ASX Listing Rules, closing of the Director Placements is subject to shareholder approval. Lancaster Park currently holds 7.2% of the issued and outstanding ordinary shares, and is associated with a director, Mr. Colin Steyn. Mr. Craig Burton is Chairman of the Company and holds 1.8% of the issued and outstanding ordinary shares. These placements represent approximate pro-rata participation in this financing by each of these parties. A shareholders' meeting for this purpose will be held in February 2010.

The Company expects that the aggregate gross proceeds of the Canadian Placement, the Australian Placement and the Director Placements (assuming Director Placements are approved by the shareholders of the Company) will, based on current exchange rates, be approximately US$50 million (collectively, the "Financing").

The Company intends to use the net proceeds of the Financing for working capital purposes.

The Company also intends to offer shareholders the opportunity to purchase up to 4,350 new shares each at A$2.30 per share (up to A$10,005 per shareholder), under a share purchase plan. The total amount raised under the share purchase plan will be capped at A$10 million. The Company currently has approximately 2,500 shareholders. The record date for the share purchase plan will be upon settlement of all trades undertaken prior to the announcement of this financing. The share purchase plan will be extended only to shareholders in jurisdictions where the Company may legally do so in reliance upon exemptions from applicable prospectus and registration requirements.

With respect to the Canadian Placement, each Special Warrant will entitle the holder thereof to receive one ordinary share of the Company. The Special Warrants are exercisable by the holders thereof at any time for no additional consideration and all unexercised Special Warrants will be deemed to be exercised on the earlier of: (i) the date that is four months and a day following closing of the Canadian Placement; and (ii) the third business day after a receipt is issued for a (final) prospectus by the securities regulatory authorities in each of the Provinces of Canada where the Special Warrants have been sold qualifying the ordinary shares issuable upon exercise of the Special Warrants.

The Company will use its reasonable best efforts to obtain such a receipt by January 29, 2010. However, if the Company fails to qualify the distribution of the ordinary shares underlying the Special Warrants by February 19, 2010, the holders of the Special Warrants will be entitled to receive 1.1 ordinary shares in lieu of one ordinary share upon the exercise or deemed exercise of the Special Warrants.

The Financing and the share purchase plan are subject to certain customary conditions and regulatory approvals, including the approval of the Toronto Stock Exchange.

This news release shall not constitute an offer to sell or the solicitation of an offer to buy securities in the United States or any other jurisdiction outside of Canada, nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. The Shares offered have not been, and will not be, registered under the United States Securities Act of 1933, as amended (the "1933 Act"), or any state securities laws and may not be offered or sold in the United States or to U.S. persons absent registration or an applicable exemption from the registration requirements of the 1933 Act and applicable state securities laws.

For and on behalf of the Board

Craig Burton, Chairman

Caution Concerning Forward-Looking Statements:

This news release contains "forward-looking statements" and "forward-looking information", which may include, but is not limited to the intended use of proceeds for the Financing, the expected closing of the Financing and the filing by the Company of a short form prospectus qualifying the ordinary shares underlying the Special Warrants. The purpose of forward-looking information is to provide the reader with information about management's expectations and plans. In making and providing the forward-looking information included in this new release, the Company has made numerous assumptions. These assumptions include among other things: (i) that the Financing closes as anticipated; and (ii) the receipt of all required regulatory and shareholder approvals. Although management believes that the assumptions made and the expectations represented by such statements or information are reasonable, there can be no assurance that the forward-looking information will prove to be accurate. Readers are cautioned that forward-looking information involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Mirabela and/or its subsidiaries to be materially different from future results, performance or achievements expressed or implied by the forward-looking information. Such risks, uncertainties and other factors include, among others, those discussed in the section entitled "Risk Factors" in the Company's most recently filed Annual Information Form. Forward-looking information contained herein are made as of the date of this press release based on the opinions and estimates of management on the date statements containing such forward looking information are made, and Mirabela disclaims any obligation to update any forward-looking information, whether as a result of new information, estimates or opinions, future events or results or otherwise, except as required by law. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward looking information.

Ordinary shares outstanding: 338,294,375

ABN 23 108 161 593

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