AAA.L Regulatory News (AAA)

2 Feb 2006 08:01

First Quantum Minerals Ld02 February 2006 Not for release, publication or distribution in whole or in part in or into Australia or Japan. NEWS RELEASE 06-03 February 2, 2006 www.first-quantum.com FIRST QUANTUM MINERALS ANNOUNCES FORMAL BID FOR ADASTRA MINERALS First Quantum Minerals Ltd. ("First Quantum", TSX Symbol "FM", LSE Symbol "FQM")announced today that on February 2, 2006, it will file with securitiesregulators in Canada and the United States its formal offer to acquire all theoutstanding shares of Adastra Minerals Inc. ("Adastra") and mail First Quantum'soffering circular and related documents to Adastra shareholders. The offer is open until 5 pm (Toronto time) on March 10, 2006, unless the offeris withdrawn or extended by First Quantum. Under the terms of the offer,Adastra shareholders will receive 1 First Quantum common share for every 17.5Adastra common shares held. Based on the closing price of First Quantum common shares on the Toronto StockExchange on January 17, 2006 (the day prior to First Quantum's announcement ofits offer for Adastra) of $38.94, the implied offer price of $2.23 represents a24% premium over the Adastra closing price of $1.80 on January 17, 2006. Theimplied offer price also represents a 31% premium over the $1.70 equityfinancing completed by the Board of Adastra in December, 2005. "Today we are putting our proposal to bring together Adastra and First Quantumdirectly to the shareholders of Adastra. We see this as a very excitingopportunity for all involved and trust that Adastra shareholders will see thingssimilarly," said Mr. Philip Pascall, Chairman and CEO of First Quantum. "Since our offer was announced, we have been very encouraged by the positivefeedback and support that we have received from shareholders with investments inboth companies who have recognized the sound strategic and operational logic incombining Adastra and First Quantum. However, we remain disappointed that theBoard of Adastra would appear still not to recognize the potential that abusiness combination with First Quantum offers their shareholders. We believeour track record in Africa is proven. We very much look forward to having theopportunity to demonstrate how First Quantum's 10 years of experience gainedthrough developing and operating mines in the Copperbelt and Mauritania can havea major impact in funding and developing the Kolwezi Copper-Cobalt TailingsProject and the Kipushi Copper Zinc Mine more efficiently and effectively thanAdastra would be able to do on its own," he added. "Following our initial attempt to negotiate an agreed merger, Adastra raised $10million by issuing shares at a dilutive $1.70 each, well below the offer levelwe had communicated to them. Furthermore Adastra implemented a shareholderrights plan ("SRP"). We see the SRP as an unnecessary delaying tactic incircumstances where Adastra has already had ample opportunity to provide theirshareholders with an alternative proposal to this proposal. Ours is acompelling offer at full and fair value and we will be asking securitiesregulators to set aside the SRP," said Mr. Pascall. The formal offer and take-over bid circular will be filed on SEDAR and on EDGAR.Adastra shareholders should read the circular and any other materials relatingto the Offer, copies of which can be obtained at the SEDAR website atwww.sedar.com or on the EDGAR website at www.sec.gov. Innisfree M&A Incorporatedhas been retained as First Quantum's information agent. For questions orassistance in regard to the offer, please telephone Innisfree M&A toll free at1-888-750-5834. About First Quantum Minerals First Quantum is a growing mining and metals company whose principal activitiesinclude mineral exploration, development and mining. The Company produces LMEgrade "A" copper cathode, copper in concentrate, gold and sulphuric acid. TheCompany's operations in Zambia include the 100% owned Bwana Mkubwa SX/EWfacility and sulphuric acid plants and the 80% owned Kansanshi open pitcopper-gold deposit. In the Democratic Republic of Congo, First Quantum operatesthe 100% owned Lonshi open pit copper mine which provides oxide copper ore forprocessing at Bwana Mkubwa, a 100% interest in the newly discovered Frontiercopper-cobalt deposit, and 11,000 sq/km of exploration rights. In Mauritania,First Quantum is developing the 80% owned Guelb Moghrein copper-gold deposit. Important Notice Persons who are resident in the United Kingdom should note the following threepoints: i. The Offer will not be subject to the provisions of the United Kingdom Takeover Code.ii. The formal offer and take-over bid circular will not constitute a prospectus for the purposes of the Prospectus Rules published by the Financial Services Authority of the United Kingdom (the "FSA"). Accordingly, the formal offer and take-over bid circular will not be reviewed or approved by the FSA or by London Stock Exchange plc and it is not intended that any action will be taken by First Quantum, by Numis Securities or by RBC entities that would permit a public offer of First Quantum shares to be made in the United Kingdom which would require an approved prospectus in accordance with the United Kingdom Financial Services and Markets Act 2000 ("FSMA") and the Prospectus Rules.iii. The Offer will be made to, and deposits of Adastra shares will be accepted from, only those shareholders in the United Kingdom who are (or who are acting on behalf of), and who are able to establish to the satisfaction of First Quantum that they are (or are acting on behalf of): "qualified investors" within the meaning of section 86(7) of FSMA, or (ii) persons to whom the Offer may otherwise be made or directed without an approved prospectus having first been made available to the public in the United Kingdom. UK shareholders receiving the formal offer and take-over bid circular should consult with their legal advisors to determine whether they are eligible as "qualified investors" or are otherwise able to receive and accept the Offer. The content of this press release, which has been prepared by and is theresponsibility of First Quantum, has been approved by Numis Securities Limited,Cheapside House, 138 Cheapside, London England EC2V 6LH, solely for the purposesof section 21 of the United Kingdom's Financial Services and Markets Act 2000.Numis Securities Limited is acting exclusively for First Quantum in connectionwith the Offer and no one else and will not be responsible to anyone other thanFirst Quantum for providing the protections afforded to clients of NumisSecurities Limited nor for providing advice in relation to the Offer or anyother matter referred to in this press release. This announcement does not constitute or form part of any offer to sell orinvitation to purchase any securities or solicitation of an offer to buy anysecurities, pursuant to the Offer or otherwise. The Offer will be made solely bythe formal offer and take-over bid circular, which will contain the full termsand conditions of the Offer, including details of how the Offer may be accepted. This announcement is for information purposes and is not a substitute for theformal offer and take-over bid circular. First Quantum plans to file with theU.S. Securities and Exchange Commission a Registration Statement on Form F-80,which will include the offer and take-over bid circular, and a tender offerstatement on Schedule 14D-1F. Adastra Shareholders are urged to read thecircular and any other materials relating to the Offer, including theregistration statement on Form F-80 and the tender offer statement on Schedule14D-1F, when these documents become available, because they will containimportant information. Copies of the circular and other materials relating tothe Offer can be obtained when they become available free of charge at the SEDARwebsite at www.sedar.com or on the EDGAR website at www.sec.gov. This press release contains forward-looking statements. The words "expect","will", "intend", "estimate" and similar expressions identify forward-lookingstatements. Forward-looking statements are necessarily based upon a number ofestimates and assumptions that, while considered reasonable by management, areinherently subject to significant business, economic and competitiveuncertainties and contingencies which could cause actual results to differmaterially from the future results expressed or implied by the forward-lookingstatements. Such statements are qualified in their entirety by the inherentrisks and uncertainties surrounding future expectations. These risk factorsinclude, but are not limited to: realization of operational synergies, relianceon Adastra's publicly available information which may not fully identify allrisks related to their performance, success in integrating the retaildistribution systems, and the integration of supply chain management processes,as well as other risk factors listed from time to time in First Quantum'sreports, comprehensive public disclosure documents including the AnnualInformation Form, and in other filings with securities commissions in Canada (onSEDAR at www.sedar.com) and the United States (on EDGAR at www.sec.gov). On Behalf of the Board of Directors 12g3-2b-82-4461of First Quantum Minerals Ltd. Listed in Standard and Poor'sSedar Profile #00006237Philip PascallChairman & CEO For further information visit our web site at www.first-quantum.com North American contact: Geoff Chater or Bill Iversen 8th Floor, 543 Granville Street, Vancouver, British Columbia, Canada V6C 1X8 Tel: (604) 688-6577 Fax: (604) 688-3818 Toll Free: 1 (888) 688-6577 E-Mail: info@first-quantum.com United Kingdom contact: Clive Newall, President1st Floor, Mill House Mill Bay Lane Horsham West Sussex RH12 1TQ United Kingdom Tel: +44 140 327 3484 Fax: +44 140 327 3494 E-Mail: clive.newall@first-quantum.com. or Carina Corbett, 4C-Burvale, Tel: + 44 20 7907 4761 The Toronto Stock Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release. Certain of the information contained in this news release constitute "forward-looking statements" within the meaning of the Private SecuritiesLitigation Reform Act of 1995. Such forward-looking statements, including butnot limited to those with respect to the prices of gold, copper and sulphuricacid, estimated future production, estimated costs of future production, theCompany's hedging policy and permitting time lines, involve known and unknownrisks, uncertainties, and other factors which may cause the actual results,performance or achievements of the Company to be materially different from anyfuture results, performance or achievements expressed or implied by suchforward-looking statements. Such factors include, among others, the actualprices of copper, gold and sulphuric acid, the factual results of currentexploration, development and mining activities, changes in project parameters asplans continue to be evaluated, as well as those factors disclosed in theCompany's documents filed from time to time with the British Columbia SecuritiesCommission and the United States Securities and Exchange Commission. ENDS This information is provided by RNS The company news service from the London Stock Exchange