Black Iron Inc.
TSX : BKI
FRANKFURT : BIN

Black Iron Inc.

February 20, 2014 09:33 ET

Black Iron Closes Bought Deal Private Placement and Announces Participation at PDAC March 2-5, 2014

TORONTO, ONTARIO--(Marketwired - Feb. 20, 2014) -

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

  • BOUGHT DEAL PRIVATE PLACEMENT CLOSED WITH AGGREGATE GROSS PROCEEDS TO BLACK IRON OF $3,005,600
  • FOCUS NOW SHIFTS TO CLOSING THE METINVEST TRANSACTION, STARTING FIRST STAGE EPCM WORK, AND SECURING AN OFF-TAKE PARTNER
  • CORPORATE ACTIVITIES AND DEVELOPMENT IN UKRAINE CONTINUE UNITERRUPTED WITH HOPES FOR A QUICK AND PEACEFUL RESOLUTION
  • BLACK IRON WILL ATTEND PDAC 2014 IN BOOTH #2552 AND PRESENT AS PART OF THE FERRO METALS & FERTILIZERS SESSION AT 3:40PM ON MARCH 4, 2014

Black Iron Inc. ("Black Iron" or the "Company") (TSX:BKI)(FRANKFURT:BIN) has closed its previously announced bought deal private placement (the "Private Placement") (see press release dated January 31, 2014) with Dundee Securities Ltd., as sole underwriter, and is pleased to announce its participation at the Prospectors and Developers Association of Canada ("PDAC") annual conference taking place from March 2-5, 2014 at the Metro Toronto Convention Centre.

Closing of Fully Subscribed Bought Deal Private Placement

Pursuant to the Private Placement, 17,680,000 units of the Company (each, a "Unit") were issued at a price of $0.17 per Unit for aggregate gross proceeds to the Company of $3,005,600. Each Unit consists of one common share of the Company and one common share purchase warrant ("Warrant"). Each Warrant will entitle the holder to purchase one common share of the Company at a price of $0.25 until February 20, 2017. If all the Warrants are exercised, it will result in additional proceeds to Black Iron of $4,420,000. The Warrants will not be listed for trading on the Toronto Stock Exchange. All securities issued pursuant to the Private Placement will be subject to a four month hold period which will expire on June 21, 2014.

"We are extremely pleased with the overwhelming support for this financing, as evidenced by the subscriber take-up and the follow-on interest received in the two weeks following announcement. We plan to use the proceeds from this private placement, along with the funds to be received upon closing of our strategic arrangement with Metinvest B.V, to fund our development needs throughout the balance of this year. With this financing behind us, our focus moves to closing the Metinvest transaction, which is expected in the coming weeks, then to the first stage of EPCM work for the Project, and to finalizing an off-take agreement," said Matt Simpson, President and CEO of Black Iron.

Corporate Activities and Development in Ukraine Continue Uninterrupted

The Company continues to monitor the situation in Kyiv and advises that business continues as usual at Black Iron's office and Project sites in Kryviy Rih, Ukraine, despite the escalating demonstrations and violence in Kyiv.

"We are saddened by the ongoing and unfortunate situation in Kyiv and are hopeful that a quick and peaceful resolution can be found for everyone involved," said Matt Simpson. "Notwithstanding these circumstances all corporate development and related activities for Black Iron continue uninterrupted, both in and outside of Ukraine. Everyone continues to go to work, and prospective off-take partners and equipment vendors continue to investigate the potential of working with us, including routine site visits and team meetings in Ukraine."

"The sooner a peaceful resolution can be achieved, the sooner the country can reassert itself as a prime destination for foreign investment. Ukraine has tremendous opportunities ahead of it with significant mineral and agricultural wealth, a unique geographical location, fully built infrastructure systems for road, rail, power, and port, and a highly skilled, hard working population."

Attending and Presenting at PDAC (Booth #2552)

Black Iron will be exhibiting at this year's PDAC Investors Exchange taking place at the Metro Toronto Convention Centre, South Building, from Sunday, March 2nd to Wednesday, March 5th, 2014.

The team from Black Iron, including Matt Simpson, President & CEO, Paul Bozoki, CFO, Aaron Wolfe, VP Corporate Development, Undriadi Benggawan, Project Director, and Michael McAllister, Manager, Investor Relations, will be available to speak to shareholders and interested investors about the Company's developments at its flagship Shymanivske Iron Ore Project in Kryviy Rih, Ukraine, including the results of an updated bankable feasibility study dated January 24, 2014 titled "Feasibility Study of the Shymanivske Iron Ore Deposit for Black Iron Inc." (the "BFS") which has been filed under the Company's profile on SEDAR at www.sedar.com. The BFS outlines an operation producing 9.9 million tonnes per year of 68% iron ore concentrate, projecting a 48% internal rate of return (39% after-tax), a US$3.3 billion net present value at an 8% discount (US$2.6 billion after-tax), and a two year payback (two and a half years after-tax). The BFS has been prepared in accordance with the guidelines of National Instrument 43-101 by the independent firms of Lycopodium Minerals Canada Ltd.; Soutex Mineral & Metallurgical Consultants; Watts, Griffis and McOuat Limited; and P&E Mining Consultants Inc.

What differentiates Black Iron from other iron ore developers is ALL of the key infrastructure essential for a cost effective project is located within very close proximity of the project site coupled with access to a highly skilled competitive cost labour force. Specifically, letters of intent have been executed to secure rail, port, power, water and natural gas from suppliers and there is a city of 750,000 people located only 35km from site via existing paved roads.

Black Iron's Presentation (3:40 pm Tuesday, March 4 in Room 802AB)

Matt Simpson, President and CEO of Black Iron will address PDAC participants as part of the Ferro Metals & Fertilizers Session on Tuesday, March 4 at 3:40 pm in Room 802AB of the Metro Toronto Convention Centre, South Building.

Exhibit Location & Hours

Black Iron will be located at booth #2552 on level 800 of the Metro Toronto Convention Centre, South Building:

Sunday March 2 10:00 am - 5:30 pm

Monday March 3 10:00 am - 5:30 pm

Tuesday March 4 10:00 am - 5:30 pm

Wednesday March 5 9:00 am - 12:00 pm

The Metro Toronto Convention Centre, South Building, is located at 222 Bremner Boulevard in Toronto. For additional information and to register for the conference, please visit www.pdac.ca.

About Black Iron

Black Iron is an iron ore exploration and development company, advancing its 100 percent-owned Shymanivske project located in Kryviy Rih, Ukraine. This project contains an NI 43-101 compliant resource, with 645.8 Mt Measured and Indicated mineral resources, consisting of 355.1 Mt Measured mineral resources grading 32.0% Total iron and 19.5% Magnetic iron, and Indicated mineral resources of 290.7 Mt grading 31.1% Total iron and 17.9% Magnetic iron, using a cut-off grade of 10% Magnetic iron. Additionally, the project contains 188.3 Mt of Inferred mineral resources grading 30.1% Total iron and 18.4% Magnetic iron. The project is surrounded by five other operating mines, including ArcelorMittal's iron ore complex. The Company believes that existing infrastructure, including access to power, rail and port facilities, will allow for a quick development timeline to production. Further, the Company holds an exploration permit for the adjacent Zelenivske project, which it intends to further explore to determine its potential. Please visit the Company's website at www.blackiron.com or write us at info@blackiron.com for more information.

The technical and scientific contents of this press release have been prepared under the supervision of and have been reviewed and approved by Matt Simpson, P.Eng, President and CEO of Black Iron Inc., who is a Qualified Person as defined by NI 43-101. For further information, please see the technical report BFS of the Company, which is available on SEDAR at www.sedar.com.

Forward-Looking Information

This press release contains forward-looking information which may include, but is not limited to, statements about the expected use of proceeds; the closing of the Metinvest transaction, the development potential of the Company's project, the timing and amount of future exploration and development of the project; and the future financial or operating performance of the Company and its projects. Often, but not always, forward-looking information can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "believes" or variations (including negative variations) of such words and phrases, or by the use of words or phrases that state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved.

Forward-looking information is based on certain assumptions and analyses made by the Company and based on known facts at the time. Forward-looking information involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company and/or its subsidiaries to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information contained in this press release, including, without limitation, those described in the Company's public disclosure documents which may be found under the Company's profile on SEDAR. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in such forward-looking information, there may be other factors that may cause actions, events or results to differ from those anticipated, estimated or intended. Should one or more of these risks or uncertainties materialize, or should assumptions underlying such forward-looking information prove incorrect, actual results, performance or achievements may vary materially from those expressed or implied by the forward-looking information contained in this press release. The forward-looking information contained herein is made as of the date of this press release and the Company disclaims any obligation to update or review such information or statements, whether as a result of new information, future events or results or otherwise, except as required by law.

Contact Information

  • Black Iron Inc.
    Michael McAllister
    Manager, Investor Relations
    +1 (416) 309-2950
    info@blackiron.com

    Black Iron Inc.
    Matt Simpson
    President & Chief Executive Officer
    +1 (416) 309-2138