Nyrstar NV
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Nyrstar NV

November 15, 2010 17:55 ET

Nyrstar Announces Binding Agreement to Pursue Friendly Offer to Acquire Farallon Mining Limited

ZURICH, SWITZERLAND--(Marketwire - Nov. 15, 2010) - Nyrstar NV ("Nyrstar") today announced that it has entered into a binding support agreement with Farallon Mining Limited (TSX:FAN) ("Farallon") pursuant to which Nyrstar has agreed to make an all-cash offer to acquire all of the issued and outstanding shares of Farallon by way of a friendly take-over offer at a price of C$0.80 per common share (the "Nyrstar Offer"), valuing Farallon's equity at approximately C$409 million (€296 million) on a fully diluted basis.

The Nyrstar Offer represents a premium of 23% to Farallon's closing share price of C$0.65 on the Toronto Stock Exchange (the "TSX") on 12 November 2010 and a premium of 32% to Farallon's volume weighted average price of C$0.61 on the TSX for the 20 trading days prior to the announcement of the Nyrstar Offer.

Farallon's Board of Directors has unanimously recommended that shareholders tender their shares in favour of the Nyrstar Offer. Paradigm Capital Inc has provided an opinion to the Farallon Board of Directors that the consideration to be received by Farallon shareholders under the Nyrstar Offer is fair, from a financial point of view, to the Farallon shareholders. Each director and officer has entered into a lock-up agreement to tender in favour of the Nyrstar Offer (2.6%). Lock-up agreements have also been entered into with Acuity Investment Management (16.3%). In aggregate, holders approximately 18.9% of Farallon common shares have agreed to tender in favour of the Nyrstar Offer.

The Nyrstar Offer will be will be financed on the basis of existing financial means and credit facilities.

The Nyrstar Offer is conditional on a number of customary conditions including a minimum acceptance condition of 66 2/3%, receipt of all regulatory approvals and no material adverse change in Farallon's business, and other customary conditions. Under the support agreement Farallon has agreed to pay Nyrstar a "break" fee of approximately C$12 million (3% of the Nyrstar Offer value) in certain customary circumstances. Further, Nyrstar has agreed to pay Farallon a "break" fee of C$1.5 million although limited to circumstances in which Nyrstar terminates the support agreement as a result of a material adverse change in Farallon's financial condition or operations. Farallon has also provided Nyrstar with certain customary rights, including a right to match any superior proposal.

The Take-Over Bid Circular and Directors' Circular are expected to be mailed and filed shortly, with the initial take up of shares to be 35 calendar days from the date of mailing.

FURTHER INFORMATION FOR FARALLON MINING SHAREHOLDERS
 
For further information, please contact the Depositary and Information Agent Kingsdale Shareholder Services Inc. North American Toll Free: 1-866-581-0507 or outside North America 1-416-867-2272.

About Farallon

Farallon is the owner of the Campo Morado zinc-rich polymetallic mining operation in Mexico (the "Campo Morado Operation"). The Campo Morado Operation comprises approximately 12,000 hectares in six mining concessions, located 160 kilometres south-southwest of Mexico City. The ore deposit currently being mined is the G-9 deposit which achieved commercial production in April 2009 and comprises high grade zinc, copper, lead, gold and silver (the "G9 Mine"). In addition to the G9 Mine, there are four additional deposits that have been delineated (Reforma, El Largo, El Ray, Naranjo).

About Nyrstar

The partner of choice in essential resources for the development of a changing world. Nyrstar is a leading global multi-metals business, producing significant quantities of zinc and lead as well as other products (including silver, gold and copper). Nyrstar is listed on NYSE Euronext Brussels under the symbol NYR. For further information visit the Nyrstar website, www.nyrstar.com.

IMPORTANT INFORMATION

This announcement has been prepared by Nyrstar NV (the "Company"). It does not constitute or form part of, and should not be construed as, an offer, solicitation or invitation to subscribe for, underwrite or otherwise acquire, any securities of the Company or any member of its group nor should it or any part of it form the basis of, or be relied on in connection with, any contract to purchase or subscribe for any securities of the Company or any member of its group, nor shall it or any part of it form the basis of or be relied on in connection with any contract or commitment whatsoever.

The information included in this announcement has been provided to you solely for your information and background and is subject to updating, completion, revision and amendment and such information may change materially. Unless required by applicable law or regulation, no person is under any obligation to update or keep current the information contained in this announcement and any opinions expressed in relation thereto are subject to change without notice. No representation or warranty, express or implied, is made as to the fairness, accuracy, reasonableness or completeness of the information contained herein. Neither the Company nor any other person accepts any liability for any loss howsoever arising, directly or indirectly, from this announcement or its contents.

This announcement includes forward-looking statements that reflect the Company's intentions, beliefs or current expectations concerning, among other things, the Company's results of operations, financial condition, exploration potential, liquidity, performance, prospects, growth, strategies and the industry in which the Company operates. These forward-looking statements are subject to risks, uncertainties and assumptions and other factors that could cause the Company's actual results of operations, financial condition, exploration potential, liquidity, performance, prospects, growth or opportunities, as well as those of the markets it serves or intends to serve, to differ materially from those expressed in, or suggested by, these forward-looking statements. In particular, information about the completion of the transactions contemplated by the Nyrstar Offer, the Company's future plans for the operation and financial results of the G-9 Mine, and the ability of the Company to continue mineral exploration in the Campo Morado Operation constitute forward-looking statements. 

The Company cautions you that forward-looking statements are not guarantees of future performance and that its actual results of operations, financial condition, exploration potential, liquidity, performance, prospects, growth or opportunities and the development of the industry in which the Company operates may differ materially from those made in or suggested by the forward-looking statements contained in this announcement. In addition, even if the Company's results of operations, financial condition, exploration potential, liquidity, performance, prospects, growth or opportunities and the development of the industry in which the Company operates are consistent with the forward-looking statements contained in this announcement, those results or developments may not be indicative of results or developments in future periods. The Company and each of its directors, officers and employees expressly disclaim any obligation or undertaking to review, update or release any update of or revisions to any forward-looking statements in this announcement or any change in the Company's expectations or any change in events, conditions or circumstances on which these forward-looking statements are based, except as required by applicable law or regulation.

The Company also cautions you that mineral reserve and mineral resource estimates for development projects are, to a large extent, based on interpretations of geological data obtained from drill holes and other sampling techniques and feasibility studies which derive costs based on anticipated tonnage and grades of ores to be mined and processed, the configuration of the ore body, expected recovery rates of metal from the ore, estimated operating costs, estimated capital costs, estimated site remediation costs and asset retirement costs, anticipated climatic conditions and other factors. There is significant uncertainty in any mineral resource estimate and the actual deposits encountered and the economic viability of a mineral deposit may differ materially from the Company's or Farallon's estimates. Mineral resources which are not mineral reserves do not have demonstrated economic viability.

This document and any materials distributed in connection with this document are not directed to, or intended for distribution to or use by, any person or entity that is a citizen or resident or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation or which would require any registration or licensing within such jurisdiction.

The distribution of this document in certain jurisdictions may be restricted by law and persons into whose possession this document comes should inform themselves about and observe any such restrictions. The Company's shares have not been and will not be registered under the US Securities Act of 1933 (the "Securities Act") and may not be offered or sold in the United States absent registration under the Securities Act or exemption from the registration requirement thereof.

Contact Information

  • Kingsdale Shareholder Services Inc.
    Depositary and Information Agent
    North American Toll Free: 1-866-581-0507
    or outside North America 1-416-867-2272