legacy signs mou with nmdc ltd

LEGACY SIGNS MEMORANDUM OF UNDERSTANDING
WITH NMDC LIMITED
Legacy is pleased to announce it has executed a memorandum of understanding ("MOU") with National Mineral Development Corporation Limited ("NMDC"), a Government of India fully owned public enterprise.
The MOU allows, subject to all necessary regulatory, FIRB, Board and shareholder approvals NMDC the right to acquire a shareholding of up to 50% in Legacy by subscribing for shares, with a price agreed between the parties. Approval by Legacy shareholders must be sought at a meeting called no later than 28 days from the execution of such an agreement.
Upon formal completion, the agreement will provide a unique platform for Legacy to source and secure additional resource projects for development and financing with the backing of NMDC as Legacy's largest shareholder. NMDC has indicated their intention to use Legacy as an Australian vehicle to acquire large-scale bulk commodity projects such as coal and iron ore.
NMDC is a Government of India owned public enterprise under the control of the Ministry of Steel, and is actively involved in the exploration of a wide range of minerals including iron ore, copper, phosphate, diamonds, tin and other metals. In 2009/10, NMDC achieved sales of 6,239 Crore (A$1.2 billion) with total assets of 15,682.99 Crore (A$3.2 billion).
NMDC currently produces approximately 30 million tonnes of iron ore (62%+ Fe) per annum and is India's single largest iron ore producer, with reported resources in excess of 800 million tonnes.*
Commenting on the MOU, Legacy Chief Executive Sharon Heng said Legacy is delighted to have entered into a memorandum of understanding whereby NMDC can acquire up to 50% of the Company, allowing Legacy to be become a diversified resource house.

This is the first investment of its type by NMDC into the Australian resource sector, and Legacy is delighted to be the company chosen as NMDC's vehicle to acquire and develop more advanced projects. With increased funding and significant financial backing, we will actively be seeking new projects such as iron ore, coal, etc to acquire which can significantly add value to Legacy shareholders.

The proposed investment comes at a time when Legacy is rapidly developing the Mt Bevan Iron Ore project, with a JORC compliant resource due to be announced in early June 2011.

The MOU is subject to the necessary regulatory, FIRB, Board and shareholder approvals, with Legacy having a period of up to 60 days to complete due diligence prior to a shareholder meeting being called to approve the transaction. Legacy will endeavour to shorten the due diligence period at any time.
Upon receiving all necessary approvals, NMDC has the right to appoint nominees to the board of Legacy.