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Company Metminco Limited
TIDM MNC
Headline Placing, Admission to Aim & First Day Of Dealings
Released 07:00 01-Apr-2010
Number 5643J07



RNS Number : 5643J
Metminco Limited
01 April 2010



For immediate release 1 April 2010

METMINCO LIMITED



PLACING, ADMISSION TO AIM AND FIRST DAY OF DEALINGS

- TOTAL FUNDRAISING OF 12 (A$ 20) MILLION



SUMMARY

Metminco successfully lists on the AIM Market of the London Stock Exchange

The Company completes 12 (A$20) million capital raising

Metminco has secured a controlling interest in Hampton.

Hampton's project portfolio includes:

- the promising Los Calatos copper project in Peru

- the pre-feasibility Mollacas copper leach and the Vallecillo gold-zinc projects in Chile

Metminco plans to accelerate exploration and development of Hampton's assets





METMINCO ADMISSION TO TRADING ON THE AIM MARKET





Metminco Limited (Metminco or the Company), an ASX listed mining exploration company, today published its AIM Admission Document and commenced trading on AIM having entered into arrangements to raise 12 (A$20) million, before listing expenses, by way of a Placing of 103,795,569 Placing Shares at a price of 9p (A$0.15) per fully paid ordinary share (Share) and through the issue of US$4 ($A4.5) million Convertible Loans.



Metminco has a 37.8% holding in Hampton Mining Limited (Hampton), which will increase to between 55% and 69% on completion of the option with Junior Investment Company (JIC Option) no later than early May 2010.



Hampton's projects, which range from mine pre-feasibility, through advanced exploration to grassroots exploration, are mainly focused on copper, but with significant exposure to gold, molybdenum and zinc, are located in north central Chile and southern Peru.



Hampton's premier project is the Los Calatos copper and molybdenum porphyry deposit located in southern Peru, near and in a similar geological setting to three large existing copper-molybdenum porphyry mines. Hence the project is close to established service infrastructure in an existing important mining region.



At Los Calatos, Hampton has estimated an initial JORC compliant resource of 262 million tonnes at a 0.2% copper cut-off grade, made up of Indicated Mineral Resources of 69.2 million tonnes at 0.44% Cu and 510ppm Mo and Inferred Mineral Resources of 192.4 million tonnes at 0.42% Cu and 382ppm Mo. Hampton is currently undertaking an eleven hole (10,000 metres) drilling program at Los Calatos.



Hampton's other advanced projects are the Mollacas copper leach project, now undertaking final leach test work leading to a feasibility study (being the precursor to the commencement of mining) and the Vallecillo gold-zinc project, both located in north central Chile.



On 17 March 2010 Metminco exercised an option with Junior Investment Company (JIC) to acquire JIC's shareholding in Hampton. On completion, no later than early May 2010, Metminco's interest in Hampton will increase from 37.8% to a minimum 55% by the issue of 72,887,884 Shares and a cash payment of US$6.6 million (if all other Hampton shareholders exercise their pre-emptive rights in full) up to a maximum of 69% by the issue of 132,787,500 Shares and a cash payment of US$ 12 million (if no other Hampton shareholders exercise their pre-emptive rights).



On gaining a controlling interest in Hampton, the sale and purchase agreement between Metminco and Highland Holdings Resources Inc (HHR) to acquire North Hill Holdings Group Inc (North Hill) for 150 million Shares and US$2 million (US$0.5 million payable on completion and US$1.5 million payable on 1 August 2010) will become unconditional (Metminco - HRR Agreement). North Hill is the indirect owner of the Alpha, Gamma and Nelson tenements which form part of the Los Calatos Project and which have been the focus of Hampton's drilling activities to date. Hampton has an option with North Hill to acquire the Alpha, Gamma and Nelson tenements which remains in place and is unaffected by the sale and purchase agreement between Metminco and HHR.



The purpose of the dual listing on AIM and associated Placing is to provide the Company with the finance it needs to complete the JIC Option and the purchase of North Hill. Completion of the JIC Option and Metminco - HHR Agreement will give the Company a controlling interest over key assets and provide a more coherent group structure.



Metminco's portfolio of gold and uranium projects in Australia will undergo progressive review in 2010, with a view to optimising their divestment through farm-out, joint venture or outright sale.



Company Chairman, John Fillmore, commented



"We are pleased that the AIM listing and associated fundraising has allowed the Company to achieve its strategic objectives of simplifying its corporate structure and associated decision making processes. The Company is now in a position to progress the development of its assets with a view to maximising value for all its shareholders. The AIM listing and associated access to the European Capital Markets are expected to be beneficial to this process."







Placing Statistics





AIM
ASX

Placing Price
9p
A$0.15

Gross proceeds raised by the Placing and Convertible Loan Notes
12.0m
A$20.0m

Estimated net proceeds of the Placing and the Convertible Loan Notes receivable by the Company
11.75m
A$19.58m

Number of new Shares being issued pursuant to the Placing
103,795,569
103,795,569

Number of new Shares being issued in lieu of fees and transaction costs
7,998,273
7,998,273

Number of Shares on issue following the Placing and Admission
492,741,775
492,741,775

Placing Shares as a percentage of the Shares in issue following the Placing and Admission
21.1%
21.1%

Market capitalisation following at the Placing Price at Admission
44 m
$A74 m

Market Capitalisation following Admission at the Placing Price and following issue of Shares to the HHR and the maximum Shares to JIC
70 m
$A116 m




Daniel Stewart and Company plc is the nominated adviser and broker to the company.

A full copy of the prospectus is available on www.metminco.com.au













Allotment of Shares and new Capital Structure



On being granted Admission to the AIM market the Company has on issue 492,741,775 Shares and 27,230,017 options exercisable at A$0.25 per Share on or before 4 December 2012. Metminco has issued 103,795,569 Shares in respect of the 9.3 million (A$15.5 million) capital raising and a further 7,998,273 Shares at an issue price of 9p ($A0.15) per Share in lieu of fees and transaction costs associated with the AIM Listing.



The Placing Shares include 25 million Shares issued to Lanstead Capital L.P. (Lanstead), an institutional investor, to raise 2.25 million (A$3.75 million). In addition, the Company will enter into an equity swap agreement with Lanstead so the Company will retain much of the economic interest in the Shares issued to Lanstead. The equity swap agreement will allow the Company to secure much of the potential upside arising from near term news flow. The equity swap agreement provides that the Company's economic interest will be determined and payable in 24 monthly tranches as measured against a price of 12p (A$0.20) per Share. These funds will be used by the Company to fund its corporate overheads over the next 2 years.



Lock-In (Escrow) Agreements



The Directors in aggregate hold an interest in approximately 26.7% of the Shares on issue at Admission. All of the Directors have undertaken to the Company and to Daniel Stewart not to sell, charge or grant any interests over any Shares held by them (subject to certain exemptions) during the twelve months following date of Admission.



Convertible Note Loan Facilities



The Company entered into convertible agreements with three parties to raise a total of US$4 (A$4.5) million. The loans will be drawn down following Admission and will be repayable within two years. The loans bear interest at 16% per annum, which will be capitalised quarterly at A$0.12 per Share. The principal may be capitalised at the lender's option at any time after six months following drawdown at A$0.12 per Share. The Company may repay the loan at any time at the Company's election. If the Company elects to repay the loan early then the Company must pay a repayment fee of one years interest and the note holder will have the right to elect to convert the loan into capital. The lender may convert earlier on a change of control of the Company, upon the disposal of a material asset or a capital raising by the Company other than on Admission of US$2 million or more. The Company will pay a fee to the lender of 4% of funds borrowed on drawdown.



Director Appointments



Metminco is pleased to announce the appointment of Mr Tim Read and Mr Francisco Vergara Irarrazaval to the Board of Metminco to fill casual vacancies.



Mr Tim Read, who is based in the United Kingdom was formerly an investment banker and corporate executive and has over forty years experience in the mining and metals sector.

Mr Francisco Vergara Irarrazaval, who is senior partner of a law firm in Santiago, Chile, has extensive experience in the resources sector in Chile and in other Latin American countries.



For further information please contact:



Metminco Limited
Tel: +61 (0)407 524 235

John Fillmore








Daniel Stewart and Company plc
Tel: 020 7776 6550

Andrew Edwards / Oliver Rigby








Buchanan Communications
Tel: 020 7466 5000

Tim Thompson / James Strong / Katharine Sutton







This information is provided by RNS
The company news service from the London Stock Exchange