TORONTO, Aug. 29 /PRNewswire-FirstCall/ -- Inmet Mining Corporation (IMN - TSX) and Petaquilla Copper Ltd. (PTC - TSX) announced today that they have entered into a definitive support agreement in connection with the revised offer by 6910360 Canada Inc. (the "Offeror"), a wholly-owned subsidiary of Inmet, announced on August 26, 2008 (the "Offer"). Pursuant to the terms of the Offer, PTC shareholders will be entitled to receive $2.20 in cash per PTC common share. The obligation of the Offeror to take up and pay for the PTC common shares is subject to the condition, among others, that there shall have been validly deposited under the Offer and not withdrawn at least 66 2/3 percent of the PTC common shares on a fully diluted basis.
The PTC Board of Directors, upon the recommendation of the special committee of the Board, has unanimously determined that the Offer is fair from a financial point of view to PTC's shareholders and is in the best interests of PTC and its shareholders. Accordingly, the PTC Board of Directors has approved the entering into of the support agreement and recommends that PTC's shareholders accept the Offer. The special committee and the PTC Board of Directors have received an oral opinion of Genuity Capital Markets that the consideration to be provided under the Offer is fair from a financial point of view to PTC's shareholders other than the Offeror, Inmet and their respective affiliates.
The support agreement provides, subject to its terms, that the PTC Board of Directors will issue a directors' circular that will contain its favourable recommendation to PTC shareholders, together with the fairness opinion provided by Genuity Capital Markets. Such directors' circular will be issued within 2 business days after Inmet mails a notice of extension and variation in connection with the Offer. Inmet anticipates that such notice will provide that the expiry time for the Offer will be 5:00 p.m. (Toronto time) on September 19, 2008. The support agreement contains, among other things, provisions for a $10 million break fee, non-solicitation of competing offers, notification by PTC to Inmet of the receipt of any alternative proposals from third parties and a right on the part of Inmet to match any such proposal.
Under provincial securities laws, PTC is required to file its annual audited financial statements for the year ended May 31, 2008 and other related disclosure documents on the System for Electronic Document Analysis and Retrieval (SEDAR) by today. PTC has advised the British Columbia Securities Commission and indicated to Inmet that it will be unable to comply with this filing requirement. Accordingly, it is a condition to the Offeror's obligation to take up and pay for the PTC common shares deposited to the Offer that PTC make the requisite filings prior to the expiry of the Offer; that the annual audited financial statements of PTC filed on SEDAR do not contain material differences from the draft financial statements delivered to Inmet on signing of the support agreement and that PTC's auditors deliver an unqualified report on PTC's annual audited financial statements.
The directors and officers of PTC, who collectively own 2,338,864 PTC common shares and 9,446,005 in-the-money options to acquire PTC common shares, and Petaquilla Minerals Ltd. which owns 20,418,565 PTC common shares, have entered into lock-up agreements with the Offeror. The aggregate total of 22,757,429 PTC common shares that the parties to such lock-up agreements collectively beneficially own or exercise control or direction over, represents approximately 14.2 percent of PTC's outstanding common shares, or 10.7 percent on a fully diluted basis. Under such lock-up agreements, the holders irrevocably agree to tender the PTC common shares owned by them, or over which they exercise control or direction, to the Offer. The parties to such lock-up agreements have also agreed to exercise all in-the-money options, warrants or other conversion, exchange or other rights owned by them to acquire PTC common shares and tender such PTC common shares, and any PTC common shares acquired by them after the date of the lock-up agreement, to the Offer.
Prior to entering into the lock-up agreements today, Inmet beneficially owned 797,100 PTC common shares, and the Offeror had entered into a lock-up agreement for an additional 15,079,000 common shares with certain institutional shareholders, resulting in beneficial ownership or control of 15,876,100 common shares or 9.9 percent of the outstanding common shares. With the additional shares now subject to lock-up agreements, Inmet and the Offeror beneficially own or control a total of 38,633,529 common shares of PTC, or 24 percent of PTC's outstanding common shares (18.2 percent on a fully diluted basis).
This press release does not constitute an offer to buy or the solicitation of an offer to sell any of the securities of Petaquilla Copper.
This press release is also available at http://www.inmetmining.com/ and http://www.petaquillacopper.com/.
About Inmet
Inmet is a Canadian-based global mining company that produces copper, zinc and gold. Inmet has interests in four mining operations in locations around the world: Cayeli, Pyhäsalmi, Troilus and Ok Tedi. Inmet also has interests in three development properties, Las Cruces, Cerattepe and Petaquilla.
About Petaquilla Copper Ltd. - Petaquilla Copper Ltd. is a resource development company headquartered in Vancouver, Canada. Its shares are listed on the Toronto Stock Exchange under the symbol PTC.
Forward looking information
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