SLW Acquires SST - 3/16/2009
Silverstone Resources Corp. ("Silverstone") (TSX VENTURE:SST) andSilver Wheaton Corp. ("Silver Wheaton") (TSX:SLW)(NYSE:SLW) todayannounced that they have entered into a definitive agreement pursuantto which Silver Wheaton will acquire by way of a plan of arrangementall of the outstanding common shares of Silverstone in exchange for0.185 common shares of Silver Wheaton for each common share ofSilverstone.
Based on the 20-day volume-weighted average of Silver Wheaton'scommon shares of C$8.58, the transaction value per Silverstone commonshare is C$1.59, and the total transaction value is approximately C$206million. This represents a premium of 40% based on the 20-dayvolume-weighted average of both companies' common shares on the TSX forSilver Wheaton and the TSX Venture for Silverstone. Silverstone's boardof directors and officers along with Capstone Mining Corp.("Capstone"), its largest shareholder (representing an aggregate of30.5 million shares (24%) of Silverstone, fully diluted), have enteredinto support agreements in respect of the transaction. Based on arecommendation from a special committee of independent directors ofSilverstone (the "Special Committee") the unconflicted members ofSilverstone's board of directors have unanimously supported thetransaction and recommend the shareholders of Silverstone vote theirshares in favour of the offer.
Highlights of the Transaction
- Immediate premium for Silverstone shareholders
- Silverstone shareholders to have an ownership stake in the largest silver streaming company in the world
- Exposure to Silver Wheaton's organic silver sales growth profilewith long life, low cost and high quality mines all located inpolitically stable jurisdictions, including Goldcorp's world-classPenasquito mine in Mexico which is now in production and is expected tobe Silver Wheaton's growth engine for years to come
- Significantly increased diversification by geography, counterparty and primary metal
- Silverstone shareholders to participate in Silver Wheaton'scontinued growth and potential re-rate of Silver Wheaton's valuation
- Significantly enhanced trading liquidity on both the Toronto and New York Stock Exchange
"Silverstone welcomes this acquisition by Silver Wheaton as webelieve this transaction benefits Silverstone shareholders, allowingthem to participate in a larger, more diversified silver stream companywith access to greater amounts of capital and liquidity. As a result ofthis transaction, Silverstone shareholders through the combinedCompany, will benefit from Silver Wheaton's growth profile includingGoldcorp's world class Penasquito mine and unique position as thelargest silver stream company in the world," said Darren Pylot,President and Chief Executive Officer of Silverstone.
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