Timminco Limited

Timminco Limited

April 27, 2009 18:15 ET

Timminco Provides Further Update on Financing Arrangements

TORONTO, ONTARIO--(Marketwire - April 27, 2009) - Timminco Limited ("Timminco" or the "Company") (TSX:TIM) announced today that it has entered into a subscription agreement with its controlling shareholder, AMG Advanced Metallurgical Group N.V. ("AMG") to purchase approximately 7.4 million common shares at a price of $2.02 per share for aggregate gross proceeds of $15.0 million. This transaction is expected to be completed on or about April 30, 2009. As a result of the transaction, AMG will own approximately 63.9 million common shares of Timminco, representing 53.8% of Timminco's total issued and outstanding share capital. Proceeds of the financing will be used for general corporate purposes, which include the repayment of monies drawn on the Company's revolving line of credit.

The price per share agreed upon with AMG is equal to the market value of a Timminco common share, as determined pursuant to the Toronto Stock Exchange ("TSX") definitions, namely, the volume weighted average trading price of such shares on the five trading days last week. This pricing formula was agreed upon by the independent designated representatives of the boards of directors of each of Timminco and AMG. The Company believes there would be insufficient demand from other investors to participate in this offering and, accordingly, has decided to proceed with a non-brokered transaction to AMG only.

"The additional capital from this financing will enable us to better manage uncertainties associated with short-term demand from Timminco's solar grade silicon customers, and potential risks with outstanding customer deposits," said Mr. Robert J. Dietrich, Executive Vice President - Finance and Chief Financial Officer of Timminco.

Given the size of the offering, the transaction must be approved by a majority of disinterested shareholders. Timminco has obtained written consents from a majority of disinterested shareholders, permitting it to proceed with the offering of common shares to AMG on the terms and price as described above.

Completion of this transaction is subject to certain conditions, including receipt of all necessary regulatory approvals, including the approval of the TSX. The common shares issued pursuant to this private placement will be subject to a four-month hold period from the date of closing.

About Timminco

Timminco is a leader in the production of low cost solar grade silicon for the solar photovoltaic energy industry. Using its proprietary, patent pending technology, Timminco purifies silicon metal into solar grade silicon (also known as upgraded metallurgical silicon) for use in the manufacture of solar cells. Timminco also produces silicon metal, magnesium extrusions and other specialty metals for use in a broad range of industrial applications serving the aluminum, chemical, pharmaceutical, electronics and automotive industries.


This news release contains "forward-looking information", as such term is defined in applicable Canadian securities legislation, concerning Timminco's future financial or operating performance and other statements that express management's expectations or estimates of future developments, circumstances or results. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "expects", "believes", "anticipates", "budget", "scheduled", "estimates", "forecasts", "intends", "plans" and variations of such words and phrases, or by statements that certain actions, events or results "may", "will", "could", "would" or "might" "be taken", "occur" or "be achieved". In this news release, such information includes statements regarding the completion of the private placement transaction with AMG, the use of proceeds from the financing, and the management of uncertainties relating to solar grade silicon customers and deposits. Forward-looking information is based on a number of assumptions and estimates that, while considered reasonable by management based on the business and markets in which Timminco operates, are inherently subject to significant operational, economic and competitive uncertainties and contingencies.
Timminco cautions that forward-looking information involves known and unknown risks, uncertainties and other factors that may cause Timminco's actual results, performance or achievements to be materially different from those expressed or implied by such information, including, but not limited to: deteriorating global economic conditions; future growth plans and strategic objectives; liquidity risks; limitations under existing credit facilities; long-term contracts for supplying solar grade silicon; solar grade silicon production cost targets; selling prices of solar grade silicon and silicon metal; achieving and maintaining the purity of solar grade silicon; production capacity expansion at the Becancour facilities; pricing and availability of raw materials for the silicon business; customer capabilities in producing ingots; limited history with the solar grade silicon business; dependence upon power supply for silicon metal production; protection of intellectual property rights; government and economic incentives; closure of the magnesium facilities and the completion of related proposed transactions; cost and availability of magnesium metal; dependence upon key customers of magnesium extruded and fabricated products; credit risk exposure; customer concentration; equipment failures; labour disputes; foreign currency exchange; dependence upon key executives and employees; completion and integration of potential acquisitions, partnerships or joint ventures; risks with foreign operations and suppliers; environmental, health and safety laws and liabilities; transportation disruptions; conflicts of interest; interest rates; intellectual property infringement claims; new regulatory requirements; changes in tax laws; and climate change. These factors are discussed in greater detail in Timminco's Annual Information Form for the year ended December 31, 2008, and Timminco's most recent Management's Discussion and Analysis, each of which is available via the SEDAR website at www.sedar.com. Although Timminco has attempted to identify important factors that could cause actual results, performance or achievements to differ materially from those contained in forward-looking information, there can be other factors that cause results, performance or achievements not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate or that management's expectations or estimates of future developments, circumstances or results will materialize. Accordingly, readers should not place undue reliance on forward-looking information. The forward-looking information in this news release is made as of the date of this news release and Timminco disclaims any intention or obligation to update or revise such information, except as required by applicable law.

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