Silvermet Inc.

Silvermet Inc.

September 27, 2010 17:51 ET

Silvermet Announces Joint Venture and US $10 Million Strategic Investment by Befesa

TORONTO, ONTARIO--(Marketwire - Sept. 27, 2010) -


Silvermet Inc. ("Silvermet") (TSX VENTURE:SYI) is pleased to announce the signing of a definitive Investment Agreement with an affiliate of Befesa Medio Ambiente, S.A. ("Befesa") of Erandio, Spain.

Befesa is the largest processor of electric arc furnace dust ("EAFD") in Europe, with four Waelz kiln facilities that process 500,000 tonnes EAFD per annum, and is a global leader in technological innovations in the processing of EAFD to recover zinc. Befesa also has expertise in upgrading and building Waelz kilns that process EAFD.


 •   Befesa and Silvermet will own 51% and 49%, respectively, of a newly established Spanish company, Befesa Silvermet Turkey, S.L. ("Befesa Silvermet")
 •   Befesa will invest US $10 million into the joint venture on the following basis: 
      o   Befesa will acquire a 10% interest in Silvermet through a private placement at $0.125 per share, or CAD $2 million, proceeds of which will be invested in Befesa Silvermet
      o   Befesa will be entitled to have a nominee on Silvermet's Board of Directors and maintain its 10% ownership level by participating in future financings
      o   US $4 million will be used to acquire the 41.5% indirect interest in Silvermet's operations held by Cooper Island Investments, L.L.C.
      o   On completion of the transactions, US $6 million will be available in Befesa Silvermet, to be used to further expand and upgrade the Turkish operations
 •   Silvermet will transfer its 58.5% interest in the operations to Befesa Silvermet
 •   Befesa will manage the operations of Befesa Silvermet, subject to unanimous consent requirements on key business decisions
 •   Befesa will introduce new technology to the Turkish operations and provide Silvermet's operational staff with training both in Turkey and at its European plants
 •   Synergistic benefits are expected as a result of Befesa's ability to achieve better project finance terms, greater purchasing power on raw materials and achieving better smelter terms due to larger total zinc concentrate volumes
 •   Befesa Silvermet intends to pursue new EAFD processing opportunities in Turkey
 •   Closing is subject to TSX-V approval and completing documentation, which is expected to occur in November

"We welcome this partnership and investment by Europe's leader in the processing of EAFD. Silvermet has been planning an expansion of its production capacity in Turkey and with the strategic investment and expertise of Befesa, we will be able to realize improvements in operating performance and increase capacity through expansions much more rapidly than we could have on our own," said Stephen G. Roman, Chairman, President and CEO of Silvermet. "We look forward to developing our relationship with Befesa as we continue to build our operations in Turkey."

About Silvermet:

Silvermet's Waelz kiln facility in Iskenderun, Turkey has been operating since May 2009 to process EAFD that is produced by local steel mills. Silvermet produces a zinc oxide concentrate from the EAFD which is sold to smelters throughout the world.

About Befesa:

Befesa is an international company that provides solutions for managing and recycling industrial waste and for water generation and management, with a strong emphasis on social responsibility to help create a sustainable world. ( Befesa is a subsidiary of Abengoa, S.A., a technology company that applies innovative technology solutions for sustainable development in the infrastructure, environment and energy sectors. (

Caution concerning forward-looking statements: The information in this release may contain forward-looking information under applicable securities laws. This forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from those implied by the forward-looking information. Factors that may cause actual results to vary include, but are not limited to, inaccurate assumptions concerning the exploration for and development of mineral deposits, political instability, currency fluctuations, unanticipated operational or technical difficulties, changes in laws or regulations, the risks of obtaining necessary licenses and permits, changes in general economic conditions or conditions in the financial markets and the inability to raised additional financing. Readers are cautioned not to place undue reliance on this forward-looking information. The Company does not assume the obligation to revise or update this forward-looking information after the date of this release or to revise such information to reflect the occurrence of future unanticipated events except as may be required under applicable securities laws. The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

The TSX Venture Exchange has in no way passed upon the merits of the transaction and has neither approved nor disapproved the contents of this press release.

Contact Information

  • Silvermet Inc.
    Stephen G. Roman
    Chairman, President & CEO
    (416) 203-8336