Wrap Text
FUM - First Uranium Corporation - First Uranium responds to reports that
Waterpan Mining Consortium Pty is seeking financing to make an offer for the
common shares of First Uranium
First Uranium Corporation
(Continued under the laws of British Columbia, Canada)
(Registration number C0777384)
(South African registration number 2007/009016/10)
Share code: FUM ISIN:CA33744R1029
FIRST URANIUM RESPONDS TO REPORTS THAT WATERPAN MINING CONSORTIUM PTY IS SEEKING
FINANCING TO MAKE AN OFFER FOR THE COMMON SHARES OF FIRST URANIUM
TORONTO AND JOHANNESBURG -- June 5, 2012 -- First Uranium Corporation (TSX:FIU),
(JSE:FUM) (ISIN:CA33744R1029) ("FIU" or the "Company") has responded to press
reports about Waterpan Mining Consortium Pty (Waterpan) which stated on June 1,
2012 that it is attempting to raise funds for a substantial offer to acquire
100% of the shares of FIU.'
The Company, under its previously announced agreements with both AngloGold
Ashanti Limited and Gold One International Limited, has undertaken to take all
such steps necessary to put into effect the proposed sales of its Ezulwini and
Mine Waste Solutions assets. Notwithstanding the commitment of FIU to the
transactions, any party is free to make a formal offer to the Company`s
shareholders to acquire all or a portion of their shares.
While FIU as a public company, without a "poison pill" or shareholders rights
plan, is open to receiving offers to its shareholders, the Company cautions
against shareholders acting in response to announcements that future offers will
be made without the offeror making an unconditional, fully financed formal offer
on terms which are not coercive or misleading.
The transactions with AngloGold Ashanti Limited and Gold One International
Limited are fully funded and almost all of the conditions precedent to
completion have been fulfilled. It is anticipated that, if approved by
shareholders, the transactions will be completed by June 29, 2012.
FIU notes the following:
* Under its Canadian Note Indenture and its Rand Note Indenture, which
govern the Secured Convertible Notes due March 31, 2013, FIU must
commence within 30 days of the occurrence of a change of control, an
offer to purchase all of the outstanding Notes for 105% of the
principal amounts of Cdn $110 million and ZAR 418.6 million,
respectively, plus accrued and unpaid interest.
* Under its Debenture Indenture, FIU must commence, within 30 days of
the occurrence of a change of control, an offer to purchase all of the
outstanding Debentures due June 30, 2012 at a purchase price equal to
100% of the principal amount of Cdn $150 million, plus accrued and
unpaid interest.
* In order to finance the acquisition in cash of 50% or more of the
common shares of FIU, an offeror such as Waterpan would have to have
sufficient cash resources to: (i) repay the required amounts under
each of the Secured Convertible Notes, the Debentures and the $10
million outstanding under the loan from Gold One International
Limited, plus interest on all of this debt, which the Company
estimates will be in excess of an aggregate of Cdn $340 million; (ii)
severance costs triggered by the change of control terms under
employment agreements; (iii) have sufficient working capital to
continue the operations at Mine Waste Solutions and Ezulwini (together
with corporate costs); and (iv) purchase the common shares together
with related costs at a premium to the amount provided under the
proposed transactions. The above may result in total aggregate
REQUIRED funding in excess of $450 million.
* If the transactions with AngloGold Ashanti Limited and Gold One
International Limited are terminated there can be no assurances that
the Company could realize more than the aggregate of $405 million
payable under the existing agreements.
* Under applicable securities laws, the time required for Waterpan to
make a formal bid now would likely extend beyond June 30, 2012 which
would result in a default under the terms of the Debentures and the
Gold One Loan, and would also trigger a default under other
agreements, including the indentures governing the Secured Convertible
Notes. Furthermore, if as a result of the termination of the asset
sales, FIU is insolvent, it may lose any rights granted in South
Africa to carry on its mining operations.
Shareholders and debtholders are reminded to vote their proxy FOR the
transactions and all related proposals before the proxy voting deadline on
Monday, June 11, 2012 at 5:00 p.m. (Toronto time).
If you have any questions about the information contained in the management
information circulars or require assistance with voting your securities, please
contact Kingsdale Shareholder Services Inc. by telephone at 1-866-581-1571 toll-
free in North America, or at 1-416-867-2272 outside of North America (collect
calls accepted), or by email at contactus@kingsdaleshareholder.com.
About First Uranium Corporation
First Uranium Corporation operates the Ezulwini Mine, an underground mining
operation, and Mine Waste Solutions, a tailings recovery facility. Both
operations are situated in South Africa.
Cautionary Language Regarding Forward-Looking Information
This news release contains and refers to forward-looking information based on
current expectations. All other statements other than statements of historical
fact included in this release are forward-looking statements (or forward-looking
information). The Company`s plans involve various estimates and assumptions and
its business and operations are subject to various risks and uncertainties. For
more details on these estimates, assumptions, risks and uncertainties, see the
Company`s most recent Annual Information Form and most recent Management
Discussion and Analysis on file with the Canadian provincial securities
regulatory authorities on SEDAR at www.sedar.com. These forward-looking
statements are made as of the date hereof and there can be no assurance that
such statements will prove to be accurate, such statements are subject to
significant risks and uncertainties, and actual results and future events could
differ materially from those anticipated in such statements, including without
limitation, the statements regarding the proposed transactions with Gold One
International Limited and AngloGold Ashanti Limited. Accordingly, readers should
not place undue reliance on forward-looking statements that are included herein,
except in accordance with applicable securities laws.
www.firsturanium.com
For further information:
John Hick or Mary Batoff
(416) 306-3072
mary@firsturanium.ca
Date: 06/06/2012 08:33:01 Supplied by www.sharenet.co.za
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