Minefinders Corporation Ltd.

Minefinders Corporation Ltd.

March 31, 2006 18:14 ET

Minefinders Announces Public Offering of Common Shares

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - March 31, 2006) -


Minefinders Corporation Ltd. (the "Company") (TSX:MFL)(AMEX:MFN) announces that it has filed a preliminary short form prospectus with the securities regulatory authorities in the provinces of Canada other than Quebec in connection with a proposed public offering of up to 10 million common shares (the "Offering"). The Offering will also be placed privately to accredited investors in the United States, and internationally, in accordance with appropriate private placement exemptions.

BMO Nesbitt Burns Inc. will act as lead underwriter and sole bookrunner for the offering, with a syndicate of underwriters including Salman Partners Inc., GMP Securities L.P., Dundee Securities Inc. and TD Securities Inc. The offering price per common share and the number of common shares to be issued will be determined prior to the filing of a final prospectus in connection with the Offering.

The Company has granted the underwriters an option exercisable for a period of 30 days following the closing of the Offering, to purchase up to an additional 10% of the common shares sold pursuant to the Offering. If the Offering and the option were fully placed, the Company would then have approximately 47.75 million shares outstanding.

The Company recently awarded BNP Paribas the sole mandate to arrange and underwrite a credit facility of up to US$100 million. The proceeds of the Offering, together with cash on hand and debt from the credit facility, will be used primarily for the construction, start-up, and operation of the Company's proposed Dolores gold and silver mine in Mexico.

Company President, Mark Bailey commented: "Our recent bankable feasibility study has estimated the cost to build and commission the Dolores mine to be approximately $132 million. We have cash on hand of approximately US$28 million and BNP is currently completing its due diligence on the project, with a view to finalizing the credit facility in Q2 2006. This new equity offering should provide us with maximum financial flexibility in determining the debt/equity mix for the Dolores mine, having regard to the competing concerns of minimizing shareholder dilution and avoiding undue forward-selling commitments."

In consideration for the service provided by the underwriters, the Company has agreed to pay the underwriters a fee equal to 5% of the gross proceeds of the Offering.

Mark H. Bailey, President and Chief Executive Officer

The securities being offered have not and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold within the United States or to or for the account or benefit of U.S. persons absent U.S. registration or an applicable exemption from the U.S. registration requirements. This news release does not constitute an offer to sell or the solicitation of an offer to purchase securities in the United States.

Contact Information

  • Minefinders Corporation Ltd.
    Mark H. Bailey
    President and Chief Executive Officer
    (604) 687-6263 or 1-866-687-6263
    (604) 687-6267 (FAX)