Size Matters….Bigger is Better !
African Copper increases bridge loan with Zambia Copper
2009-04-28 06:09 ET - News Release
Mr. Tom Kamwendo reports
ZAMBIA COPPER INVESTMENTS LIMITED "ZCI" : IMPROVED US$22.5 MILLION FINANCING OFFER TO AFRICAN COPPER PLC "ACU"
Zambia Copper Investments Ltd. (ZCI) has arranged an improved binding financing proposal for African Copper PLC and to clarify misleading remarks concerning ZCI's proposal made by Natasa Mining Ltd. in its news in Stockwatch dated April 21, 2009.
ZCI's improved proposal significantly increases the bridge loan facility offered by it from $2.5-million to $10-million so that ACU can:
- Satisfy all repayment obligations to Natasa in full, removing the ability of Natasa to force ACU into liquidation;
- Pay African Copper's bondholders and key trade creditors 50 per cent of the total amounts payable to them under the Zambia Copper terms in advance of the full implementation of Zambia Copper's proposal;
- Protect African Copper shareholders' investment in Botswana.
As an indication of the seriousness of its intent, Zambia Copper has transferred the full $10-million amount of the bridge loan facility to its solicitors in London, McCarthy Tetrault, to be held in trust at National Westminster Bank PLC, Fleet Street, London branch, for the purposes of the implementation of Zambia Copper's proposal.
The full $22.5-million offer from Zambia Copper will satisfy bondholders and creditors and give shareholders in African Copper the chance of significant upside in future operations. Shareholders, bondholders and creditors should note that Natasa's agreements with bondholders and creditors are conditional on African Copper's shareholders voting in favour of certain resolutions proposed for African Copper's May 7 EGM. Shareholders are accordingly urged to vote against the resolutions at the EGM enabling African Copper to proceed with Zambia Copper's offer.
Commenting on Zambia Copper's proposals, Tom Kamwendo, chairman, said:
"This new offer does three things: Firstly it should satisfy all external stakeholders -- shareholders, creditors and the wider Botswanan mining industry that we are committed to taking African Copper toward a strong future as a listed, successful copper miner.
"Secondly, it demonstrates that our promise of finance is real -- we have put transparent funds in place that creditors can and will be paid according to the transaction timetable.
"Finally, we have blown Natasa's offer and reservations out of the water. This package is quite clearly in advance of anything that they have come up with for creditors, shareholders and Botswana itself.
"Under these circumstances, African Copper shareholders should vote against Natasa at the EGM to enable themselves and other stakeholders to benefit from Zambia Copper's superior proposal."
Should African Copper shareholders or other African Copper stakeholders require any clarification of the terms of Zambia Copper's offer or have other feedback relating to the offer they can contact Zambia Copper at zambiacopper@email.lu or its representatives.