MMX Executes Agreement for the Purchase of Minerminas
January 15 2008 - 2:55PM
Marketwired
RIO DE JANEIRO, BRAZIL (BOVESPA: MMXM3) (TSX: XMM), pursuant to
article 157 of Law 6404/76, and CVM Instruction No. 358/02, hereby
makes the following announcement:
The Company has entered into an agreement with the shareholders
of Minerminas - Mineradora Minas Gerais Ltda. ("Minerminas"), by
which AVX Minera��o Ltda. ("AVX"), its direct subsidiary, will,
subject to certain conditions that are customary to this type of
transaction, acquire 100% of the issued and outstanding shares of
capital stock of Minerminas.
Consummation of the purchase of Minerminas by AVX should occur
in the first quarter of 2008 upon fulfillment of the
above-mentioned conditions. With the conclusion of the operation,
AVX will pay as consideration for 100% of the shares of Minerminas
the purchase price of US$125,000,000, payable in 7 semi-annual
consecutive installments.
Minerminas operates an iron ore mine adjacent to the operations
of AVG Minera��o S.A. ("AVG"), an indirect subsidiary of the
Company, and also owns other mining rights and leases in the Serra
Azul region, in Minas Gerais.
According to information provided by Minerminas, the company
produced approximately 700,000 tons of iron ore in 2007. Based on
the Company's estimates, the Minerminas production may reach 2.6
million tons in 2008 with the following breakdown: 550,000 tons of
lump, 1.9 million tons of sinter feed and 150,000 tons of pellet
feed.
The Company, through its subsidiary AVX, should merge the
operations of AVG with those of Minerminas in order to achieve
synergies and efficiency gains. The Company estimates that the
integrated operations of AVX will result in iron ore production of
6.1 million tons in 2008, while engineering studies will be carried
out to increase production to 8 million tons in 2009. For this, the
Company plans to invest US$ 8.1 million in 2008 to improve
operations in Minerminas, in addition to the investments planned
for the expansion of production at AVG.
For more information, please contact ri@mmx.com.br
Luiz Rodolfo Landim Machado
Executive President and Investor Relations Officer
MMX Minera��o e Met�licos S.A.
FORWARD-LOOKING STATEMENTS: This material fact contains certain
"forward-looking statements" and "forward-looking information"
under applicable Canadian securities laws concerning the proposed
acquisition operation and the business plan, the operations and
financial performance and condition of MMX, and estimated
production and mine life of the acquired mineral project. Except
for statements of historical fact relating to MMX, certain
information contained herein constitutes forward-looking
statements. Forward-looking statements are frequently characterized
by words such as "plan," "expect," "project," "intend," "believe,"
"anticipate," "estimate" and other similar words, or statements
that certain events or conditions "may" or "will" occur.
Forward-looking statements are based on the opinions and estimates
of management at the date the statements are made, and are made
taking into consideration a number of assumptions and, therefore
are subject to a variety of risks and uncertainties and other
factors that could cause actual events or results to differ
materially from those projected in the forward-looking statements.
Assumptions upon which such forward-looking statements are based
include MMX and its subsidiaries being fully successful in
acquiring 100% of the issued and outstanding shares of Minerminas,
any eventual third party, regulatory or governmental approvals for
the acquisition operation being obtained, all required
environmental and other licenses being obtained and all other
conditions to the completion of the acquisition transaction will be
satisfied or waived. Many of these assumptions are based on factors
and events that are not within the control of MMX and there is no
assurance they will prove to be correct. Factors that could cause
actual results to vary materially from results anticipated by such
forward-looking statements include changes in market conditions,
variations in ore grade or recovery rates, risks relating to
international operations, fluctuating metal prices and currency
exchange rates, changes in project parameters, the possibility of
unanticipated costs and expenses, failure of plant, equipment or
processes to operate as anticipated, the failure to obtain
necessary licenses or permitting, the acquired mineral project not
being integrated successfully or such integration proving more
difficult, time consuming or costly than expected, and other risks
of the mining industry. Although MMX has attempted to identify the
important factors that could cause actual actions, events or
results to differ materially from those described in
forward-looking statements, there may be other factors that cause
actions, events or results not to be anticipated, estimated or
intended. There can be no assurance that forward-looking statements
will prove to be accurate, as actual results and future events
could differ materially from those anticipated in such statements.
MMX undertakes no obligation to update forward-looking statements
if circumstances or management's estimates or opinions should
change, except as required by applicable securities laws. The
reader is cautioned not to place undue reliance on forward-looking
statements.
MMX - Investor Relations Elizabeth Cruz / Gina Pinto Tel. 55 21
2555-5634 / 2555-5558 Email Contact www.mmx.com.br/ri
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