Kinbauri Gold Corp. (TSX VENTURE: KNB)(FRANKFURT: 3KG.DE)
A conference call will be held on Tuesday July 14, 2009 at 1:00
p.m. EDT
Presentation available at
http://events.snwebcastcenter.com/kinbaurigold/20090714/index.php
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Call-in Numbers
Greater Toronto - 416 644 3424
Toll-Free (North America) - 800 732 0232
Toll-Free (UK, France, Germany, Switzerland, Spain) - 00 800 2288 3501
Toll-Free (Australia) - 0011 800 2288 3501
Playback
Toronto: 416-640-1917 Passcode: 21310993#
Toll-Free: 877-289-8525 Passcode: 21310993#
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Kinbauri Gold Corp. (TSX VENTURE: KNB)(FRANKFURT: 3KG.DE)
("Kinbauri") announced today that it has signed a binding letter
agreement dated July 12, 2009, with ATW Gold Corp. (TSX VENTURE:
ATW) ("ATW") to combine the two companies at the agreed exchange
ratio of 1.35 ATW shares per Kinbauri share, which implies a
purchase price of C$0.85 per Kinbauri share using closing share
prices on July 10, 2009 (the "ATW Transaction").
The ATW Transaction represents a premium of 55% over the closing
price of Kinbauri shares on July 10, 2009 and a premium of 115%
over the closing price of Kinbauri shares on May 8, 2009, the last
trading day prior to the announcement by Orvana Minerals Corp.
(TSX: ORV) ("Orvana") of its intention to make an unsolicited offer
of C$0.55 per share.
On June 9, 2009, Kinbauri's Board of Directors unanimously
recommended that Kinbauri shareholders REJECT the unsolicited offer
to purchase all of the outstanding Kinbauri shares made by Orvana
as described in a take-over bid circular dated May 25, 2009.
Brian McEwen, Director of Kinbauri and member of its Special
Committee, stated, "The ATW Transaction delivers significant value
to Kinbauri shareholders and to Kinbauri's flagship El Valle
Project and we recommend that all shareholders join us in
supporting the transaction."
The Kinbauri Board of Directors has unanimously recommended that
Kinbauri shareholders vote in favour of the ATW Transaction and
continue to reject the Orvana offer. The combination of Kinbauri
and ATW would move ATW closer to its goal of becoming a mid-tier
gold producer. It would also feature;
- Diversified operations with significant reserve/resource
upside in three producing or close to producing gold mines. The
assets have significant infrastructure already in place, and are
located in geopolitically and mining friendly jurisdictions;
- Management from both ATW and Kinbauri with their extensive
combined mine operating, development, financing and exploration
experience, including Graham Harris as Executive Chairman, Brent
Butler as CEO and Brian McEwen as President; and
- Strategic position and management experience to leverage
continued consolidation in the gold industry.
"We understand that higher offers for the Kinbauri assets were
being entertained and therefore our efforts were directed towards
expediting a friendly transaction that would benefit both
shareholder groups. Our merger with Kinbauri brings ATW closer to
its stated goal of becoming a leading mid-tier gold producer." said
Graham Harris, Executive Chairman of ATW. "We are pleased to
combine ATW's strong foundation of professionals, with experience
bringing our Burnakura mine into production, with Kinbauri's
team."
Upon completion of the ATW Transaction, ATW will have
approximately 149,691,086 common shares issued and outstanding,
with former Kinbauri shareholders holding approximately 53.5% of
the issued and outstanding common shares of the combined
company."
ATW Transaction Details
The ATW Transaction is expected to be structured as a plan of
arrangement between Kinbauri and a newly formed, wholly-owned
subsidiary of ATW. Under the terms of the ATW Transaction, Kinbauri
shareholders will receive 1.35 common shares of ATW per common
share of Kinbauri held. Each outstanding Kinbauri convertible
security will become exercisable for ATW common shares based on the
exchange ratio and resulting price adjustment. Two Kinbauri
directors, Brian McEwen and Marilyn Bloovol, will join the ATW
Board of Directors. Brian McEwen will also be appointed President
of ATW and President of Kinbauri Espana. The ATW Transaction will
be subject to approval of the shareholders of Kinbauri and ATW.
Gryphon Partners, acting as financial advisor to the Special
Committee of the Board of Directors of Kinbauri, has provided an
opinion that the ATW offer is fair, from a financial point of view,
to Kinbauri shareholders.
The letter agreement setting out the ATW Transaction includes a
commitment by Kinbauri not to solicit alternative transactions to
the proposed ATW Transaction and to enter into a definitive
arrangement agreement. ATW has also been provided with certain
other rights customary for a transaction of this nature, including
the right to match competing offers made to Kinbauri. The letter
agreement also provides for a break fee of approximately $1 million
to be payable to ATW in certain circumstances.
Completion of the ATW Transaction is subject to a number of
conditions, including: the receipt of all necessary regulatory and
court approvals (including the approval of the TSXV) and obtaining
approvals from the shareholders of ATW and Kinbauri at meetings to
be held no later than September 25, 2009. There can be no assurance
that the ATW Transaction will be completed as proposed or at
all.
Investors are cautioned that, except as disclosed in the
management information circular to be prepared in connection with
the ATW Transaction, any information released or received with
respect to the ATW Transaction may not be accurate or complete and
should not be relied upon. Trading in the securities of Kinbauri
should be considered highly speculative.
Gryphon Partners is the financial advisor to Kinbauri's Special
Committee and its legal advisor is Wildeboer Dellelce LLP. ATW's
financial advisor is PI Financial Corp. and its legal counsel is CD
Farber Law Group.
All information contained in this new release with respect to
ATW was supplied by ATW for inclusion herein, and with respect to
such information, Kinbauri and its board of directors and officers
have relied on ATW.
About ATW
ATW is a gold producer and developer, with two gold mines in
Western Australia and is listed on Tier 1 of the TSX Venture
Exchange ("TSXV") (TSX VENTURE: ATW). ATW's corporate goal is to
build a mid-tier gold producer.
ATW is incorporated under the Business Corporations Act (British
Columbia) and was listed on the TSXV in November 2006 via an
initial public offering. ATW made its first mining acquisition, the
Burnakura Gold Mine, in December 2007. Within 15 months, Burnakura
was recommissioned, permitted and gold production commenced. During
that time, six months after the Burnakura acquisition, ATW acquired
its second mine, the Gullewa Gold Mine. The Gullewa Mine, a
past-producing mine, is ATW's flagship project. ATW is conducting
further exploration and other work with the goal of commencing
production from the Gullewa Mine in 12 to 15 months. ATW's team is
comprised of Mine Engineers, Geologists and finance experts, with
over 100 years of combined experience in the mining industry having
operated worldwide.
www.atwgold.com
Shareholders do not have to take any action on the Orvana offer
and the Kinbauri Board urges you to reject it and vote in favour of
the ATW Transaction.
For assistance in withdrawing any shares already tendered, or
other questions, please contact Laurel Hill Advisory Group, the
Information Agent retained by Kinbauri in connection with the
Orvana Offer, toll free at 1-888-812-9184 from anywhere in Canada
or the United States and collect at 416-637-4661 from outside North
America.
Note Regarding Forward-Looking Statements
This press release and other written or oral communication from
the Company may include certain statements that may be considered
"forward-looking statements" within the meaning of that phrase
under Canadian securities laws. Statements other than historical
facts that address possible future events, plans or developments
are forward-looking statements. Such statements may be identified
by the use of words such as "will", ""may", "expects", "estimate",
"intend" or the use of the future or conditional tense. Certain
material factors or assumptions were applied in drawing our
conclusions and making those forward-looking statements.
Forward-looking statements reflect management's current views with
respect to possible future events and conditions and, by their
nature, are based on management's beliefs and assumptions and
subject to known and unknown risks and uncertainties, both general
and specific to the Company. Although the Company believes the
expectations expressed in such forward-looking statements are
reasonable, such statements are not guarantees of future
performance and actual results or developments may differ
materially from those in our forward-looking statements. Readers
are cautioned that risks may change or new risks may emerge.
Additional information regarding the material factors and
assumptions that were applied in making these forward looking
statements as well as the various risks and uncertainties we face
are described in greater detail in the "Risk Factors" section of
our annual and interim Management's Discussion and Analysis of our
financial results and other continuous disclosure documents and
financial statements we file with the Canadian securities
regulatory authorities which are available at www.sedar.com and
available on the Company's website at www.kinbauri-gold.com. The
Company undertakes no obligation to update this forward-looking
information except as required by applicable law.
www.kinbaurimaximized.com
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
Contacts: Kinbauri Gold Corp. Darrell Munro, BB.A, LL.B,
Manager, Corporate Communications 613-836-0198
dmunro@kinbauri-gold.com Kinbauri Gold Corp. Brian McEwen, P Geol.,
Director 604-551-6979 bmcewen@kinbauri-gold.com
www.kinbauri-gold.com News media: Barnes McInerney Inc. Craig
MacPhail 416-367-5000 ext. 244 cmacphail@barnesmcinerney.com
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