Strategic Minerals Regulatory News (SML)

7 February 2013

Strategic Minerals Plc

("Strategic Minerals" or the "Company")

£4.2 million Institutional fundraising to fund working capital for full scale production in New Mexico

Highlights:

·; £4.2 million, net of expenses, raised through a placing of new shares

·; Funds raised through the issue of 102,666,667 new ordinary shares at a price of 4.5p per share

·; The 60-day moving average price of the Company's shares at the market close on 4 February 2013 ( last practicable date before pricing) was 4.86p per share

·; This Institutional placement leaves the Company fully financed for its current operations

·; Funds raised to be primarily used to provide working capital for the Company's magnetite tailings deposit at the Cobre Mine in New Mexico which is now in full scale production and well positioned to achieve shipments in the export market of approximately 50,000 DMT per month

·; Next shipment of 53,000 DMT currently being loaded at the port of Guaymas

Strategic Minerals Plc (AIM: SML; USOTC: SMCDY), the magnetite iron ore producer and exploration company, is delighted to announce that it has raised £4,200,000, net of expenses from institutional and other investors through the placing of 102,666,667 new ordinary shares of 0.1p each (the "Placing Shares") at a price of 4.5p per Placing Share (the "Placing"). The Placing was conducted for the Company by WH Ireland Limited.

Paul Harrison, CEO of Strategic Minerals, said:

"We are delighted to announce this successful placing and in particular the interest shown by new institutional investors participating in this financing. The funding will be used primarily to meet the working capital needs of our operations at the Cobre mine in New Mexico including inside mine gate costs, rail freight to port and all port costs at Guaymas. This funding will ensure that monthly export shipments can proceed uninterrupted and leaves the Company fully financed for all of its current operations."

Background

The Company announced in June 2012 that it had completed the rehabilitation and upgrade of the rail link to the Cobre Mine in New Mexico to enable rail shipments of its magnetite iron ore to begin. In August it announced the successful completion of a test shipment by rail to the port of Guaymas in Mexico and in September the Company announced its state of readiness to commence exports shortly. In November it announced that export sales had commenced with the first export market shipment of over 47,000 dry metric tonnes ("DMT") to Glencore AG. In addition, the Company continues to service the USA domestic market at increasing levels through truck sales at mine gate.

During 2013 the Company intends to complete monthly shipments of approximately 50,000 DMT. The funds raised in the Placing will be used primarily to provide working capital for the monthly shipments, as well as to strengthen the balance sheet. The first of these shipments, approximately 53,000 DMT, is currently being loaded, at the port of Guaymas in Mexico.

The Placing

The Placing Shares have been conditionally placed by W H Ireland Limited ("WHI"). Under the terms of a placing agreement dated 7 February 2013 and entered into between the Company and WHI, WHI has agreed to use its reasonable endeavours to procure placees for the Placing Shares at the Placing Price. The Placing is not underwritten.

Application has been made for the Placing Shares to be admitted to trading on AIM ("Admission") and it is anticipated that Admission will occur on 8 February 2013. On Admission the Placing Shares, will rank pari passu with the Company's existing ordinary shares of 0.1p each ("Ordinary Shares").

Total Voting Rights

Following Admission the total number of Ordinary Shares in issue will be 550,825,560. This figure may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the share capital of the Company under the Financial Services Authority's Disclosure and Transparency Rules. 

The Placing was carried out within the Company's existing share authorities.

For further information:

Contacts: