VANCOUVER, BRITISH COLUMBIA — (Marketwire) — 01/24/13 — First Quantum Minerals Ltd. („First Quantum“) (TSX: FM)(LSE: FQM) today announced that it has posted on its website at the following open letter to the holders of common shares of Inmet Mining Corporation („Inmet“) in response to Inmet-s announcement that its Board of Directors has mailed its Directors- Circular relating to First Quantum-s offer for the issued and outstanding Inmet common shares:
Dear Holders of Inmet Common Shares,
We note the announcement by Inmet on 22 January 2013 that the Inmet Board has sent to you its Directors- Circular responding to our offer for your Inmet shares. In the Directors- Circular, the Inmet Board has formally recommended that you reject our offer. We have read the Directors- Circular carefully and note that:
The Directors- Circular sets out the considerations upon which the Inmet Board based its recommendation to you. In our view, many of these are flawed, paint a selective picture or raise unnecessary concerns. We believe a more complete and accurate assessment of our offer could have been made had the Inmet Board accepted any of our many invitations to engage in a constructive dialogue and exchange of information.
In any event, there is nothing in the Directors- Circular that alters our conviction that the logic and terms of our offer are compelling and that our long term vision of the combined company is sound and in the best interests of Inmet-s shareholders.
Why First Quantum believes you should not rely upon the Inmet Board-s recommendation but instead make your own determination in respect of our offer
First Quantum-s offer has significant commercial benefits, places a fair and substantial premium valuation on Inmet and its assets and provides a brighter future for all Inmet shareholders.
First Quantum-s response to the Directors- Circular
All of us at First Quantum are proud of our company, its achievements and the value we have delivered to investors over the years. We would prefer that our communications with Inmet and its shareholders be focused on the benefits of a combination of our two companies rather than engage in public exchanges regarding our respective track records. Unfortunately, the Directors- Circular includes a number of ill-founded assertions, which underpin the Inmet Board-s recommendation to you and which we therefore believe need to be addressed. They are addressed in the Attachment to this letter.
What First Quantum and Inmet can accomplish together
First Quantum has built mines around the world, applying its development expertise to some of the industry-s most challenging projects, in the hottest and coldest, driest and wettest climates, spanning sophisticated first-world locations to developing economies. Our development experience includes having commenced development of nine new major mining projects in the last ten years. It makes us fully aware that each project presents its own unique challenges, not only in terms of technical execution but also in terms of managing the social and political issues peculiar to the local jurisdiction.
Inmet-s attempt to raise concerns about the level of our experience in Panama and our level of familiarity with the Cobre Panama project misses a fundamental point: it has never been our intention, and First Quantum does not propose, to overcome, on our own, the challenges presented by the Cobre Panama project. We have consistently stated that it is our intention to overcome these challenges by relying upon the best elements, including the best human resource elements, of our two companies. It is our expectation that our technical competencies and experience can be combined with Inmet-s valuable social license in Panama and familiarity with the Cobre Panama project in order to achieve, together, what neither company could achieve at Cobre Panama on its own.
We are highly confident that First Quantum-s unique technical capabilities can contribute meaningfully and positively to project execution and de-risking of Cobre Panama. Our track record of successfully building mines over the past decade compares favourably to Inmet-s record of building one mine, and not without some difficulty, in the last 20 years.
First Quantum deserves equal treatment. The Inmet Board should talk to us
Inmet shareholders have a number of reasons to be disappointed with the information disclosed in the Directors- Circular:
We are aware that a large number of you have made known to the Inmet Board your views on some of these matters. We are appreciative of this. We would urge others among you who share our vision and support the idea of an open dialogue and exchange of information between our two companies to likewise appeal to the Inmet Board to engage with us.
First Quantum offers Inmet shareholders the opportunity to judge for themselves
In light of the Inmet Board-s refusal to engage with us in an effort to properly evaluate the considerable merits of our offer, we wish to invite Inmet shareholders to evaluate the opportunity for themselves. First Quantum will be hosting a series of investor meetings in Toronto at which all Inmet shareholders will be welcome. At these meetings, you will have the opportunity to speak to and hear from members of First Quantum-s senior management team and learn for yourselves about our great company and our vision for the combined enterprise. We hope you will be able join us at these events. Further details regarding the timing of the meetings will be announced shortly.
In the meantime, we caution you against relying upon the flawed analysis and recommendation provided to you by the Inmet Board and we encourage you instead to judge the merits of our offer for yourselves.
Regards,
Philip Pascall
ATTACHMENT
Advisors and Information Agent
First Quantum has engaged Jefferies International, Goldman, Sachs & Co., and RBC Capital Markets to act as its financial advisors in connection with the Offer. Fasken Martineau DuMoulin LLP is acting as legal counsel to First Quantum in connection with the Offer.
Georgeson Shareholder Communications Canada, Inc. has been retained as information agent for the Offer. Shareholders may contact Georgeson at:
Toll Free (North America): 1-866-656-4120
Outside North America Call Collect: 1-781-575-2421
Email:
About First Quantum
First Quantum is a leading international mining company with a global portfolio of copper and nickel assets located in Africa, Australia, South America and Europe. For the twelve months ended 30 September 2012, First Quantum generated revenue and adjusted EBITDA of US$2,743 million and US$1,014 million respectively and produced 290 kt of copper, 32 kt of nickel and 181 koz of gold. A diverse portfolio of profitable operating assets and quality growth projects makes First Quantum one of the fastest-growing mining companies in the world. First Quantum expects that its final production numbers for 2012 will reflect 270 – 290 kt of copper and 36 – 40 kt of nickel produced. First Quantum is listed on the Toronto, London and Lusaka Stock Exchanges, with a market capitalization of approximately US$10.5 billion.
First Quantum has earned a strong reputation as an industry leading developer of high-quality base metals projects globally. Although a significant copper producer currently, First Quantum is itself in a phase of transformational growth, with an anticipated tripling of copper production by the end of 2018. To achieve this growth, the First Quantum team is building on its significant experience in project development, with a proven record of successfully developing resource assets. The capital intensity of our Kansanshi and Sentinel developments, for example, at approximately US$5,000 / tonne and US$6,000 / tonne, respectively, are among the lowest in the industry. Importantly, First Quantum has consistently delivered superior shareholder returns, averaging 32 percent per annum over the period 2000 to 2011.
Forward Looking Information
Certain statements and information in this press release, including all statements that are not historical facts, contain forward-looking statements and forward-looking information within the meaning of applicable securities laws. Such forward-looking statements or information include but are not limited to statements or information with respect to the anticipated completion of the proposed Offer and the anticipated strategic and operational benefits of the Offer. Often, but not always, forward-looking statements or information can be identified by the use of words such as „plans“, „expects“ or „does not expect“, „is expected“, „budget“, „scheduled“, „estimates“, „forecasts“, „intends“, „projects“, „anticipates“ or „does not anticipate“ or „believes“ or variations of such words and phrases or statements that certain actions, events or results „may“, „could“, „would“, „might“ or „will“ be taken, occur or be achieved.
With respect to forward-looking statements and information contained in this press release, First Quantum has made numerous assumptions including, among other things, assumptions about the price of copper, gold, cobalt, nickel, PGE, and sulphuric acid, and other anticipated costs and expenditures. Although management of First Quantum believes that the assumptions made and the expectations represented by such statements or information are reasonable, there can be no assurance that any forward-looking statement or information herein will prove to be accurate. Forward-looking statements and information by their nature involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements or information. These risks, uncertainties and other factors include, but are not limited to, uncertainties surrounding the ability to realize operational synergies following completion of the Offer, reliance on Inmet-s publicly available information which may not fully identify all risks related to its performance, success in integrating the retail distribution systems, and the integration of supply chain management processes, future production volumes and costs, costs for inputs such as oil, power and sulphur, political stability in Zambia, Peru, Mauritania, Finland, Turkey, Spain, Panama and Australia, adverse weather conditions in any of the foregoing countries, labour disruptions, mechanical failures, water supply, procurement and delivery of parts and supplies to the operations, and the production of off-spec material.
See First Quantum-s annual information form for additional information on risks, uncertainties and other factors relating to the forward-looking statements and information. Although we have attempted to identify factors that would cause actual actions, events or results to differ materially from those disclosed in the forward-looking statements or information, there may be other factors, many of which are beyond the control of First Quantum, that might cause actual results, performances, achievements or events to differ from those anticipated, estimated or intended. Accordingly, readers should not place undue reliance on forward-looking statements or information.
While First Quantum may elect to update the forward-looking statements at any time, First Quantum does not undertake to update them at any particular time or in response to any particular event, other than as may be required by applicable securities laws. Investors and others should not assume that any forward-looking statement in this press release represent management-s estimate as of any date other than the date of this press release.
Other
This press release does not constitute an offer to buy or an invitation to sell, or the solicitation of an offer to buy or invitation to sell, any of the securities of First Quantum or Inmet. Such an offer may only be made pursuant to an offer and take-over bid circular filed with the securities regulatory authorities in Canada.
First Quantum has also filed with the U.S. Securities and Exchange Commission („SEC“) a Registration Statement, which includes the offer and take-over bid circular relating to its offer to Inmet shareholders. FIRST QUANTUM URGES INVESTORS AND SECURITY HOLDERS TO READ THE REGISTRATION STATEMENT, THE OFFER AND TAKE-OVER BID CIRCULAR AND ANY OTHER RELEVANT DOCUMENTS TO BE FILED WITH THE SEC AND CANADIAN SECURITIES REGULATORY AUTHORITIES, BECAUSE THEY CONTAIN IMPORTANT INFORMATION. Investors may obtain a free copy of the offer and take-over bid circular and other documents filed by First Quantum with the Canadian securities regulators at and with the SEC at the SEC-s website at . The offer and take-over bid circular and other documents may also be obtained free of charge from First Quantum-s website at or upon request made to First Quantum at 8th Floor, 543 Granville Street, Vancouver, British Columbia V6C 1X8.
Contacts: First Quantum Minerals Ltd. – North American Contact Sharon Loung Director, Investor Relations (647) 346-3934 or Toll Free: 1 (888) 688-6577 (604) 688-3818 (FAX)
First Quantum Minerals Ltd. – United Kingdom Contact Clive Newall President +44 140 327 3484 +44 140 327 3494 (FAX)
Jefferies International Peter Bacchus Managing Director +44 778 994 3482
Media: Harmony Communications Brian Cattell Senior Partner +44 20 7016 9155
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