PERTH, WESTERN AUSTRALIA--(Marketwire - Aug. 23, 2012) -
Talison Lithium Limited ("Talison" or the "Company") (TSX:TLH)
announced today that it has entered into a definitive Scheme
Implementation Agreement ("SIA") with Rockwood Holdings, Inc.
("Rockwood") under which it is proposed that Rockwood, or a wholly-owned
entity of Rockwood, will acquire 100% of the ordinary shares in the
capital of Talison (the "Shares") by way of a Scheme of Arrangement
("Scheme") under the Australian
Corporations Act 2001 (Cth) for cash
consideration of C$6.50 per share. This values the equity of Talison at
approximately C$724 million on a fully diluted basis.
The cash consideration of C$6.50 per Share, represents:
- A 53% premium to Talison's last closing price on August 22, 2012 of C$4.24;
- A 52% premium to Talison's 10 day volume weighted average price ("VWAP") of C$4.28; and
- A 59% premium to Talison's 30 day VWAP of C$4.08.
The cash consideration provides an opportunity for Talison
Shareholders to realise immediate value for their Shares at a
substantial premium to market and reflects the size, strategic nature
and growth potential of Talison's lithium operations.
The SIA entered into by Talison and Rockwood also proposes
that Rockwood, or a wholly-owned entity of Rockwood, will acquire 100%
of the options to acquire Shares ("Options") through an option scheme of
arrangement ("Option Scheme") for cash consideration of C$6.50 per
Option less the exercise price for that Option.
The board of directors of Talison ("Talison Directors") has
considered the Scheme and the Option Scheme and unanimously recommends
that Shareholders and Optionholders vote in favour of the Scheme and the
Option Scheme, in the absence of a Superior Proposal (as defined in the
SIA) and subject to an Independent Expert concluding that the Schemes
are in the best interests of security holders. Each of the Talison
Directors intends to vote the Shares and Options held or controlled by
them in favour of the Scheme and Option Scheme.
Resource Capital Fund IV L.P. and Resource Capital Fund V
L.P. (collectively, the "RCF Funds"), together having a 36.8%
shareholding interest in Talison, have each confirmed to Talison that,
in the absence of an offer which the RCF Funds determine is superior,
they support the Scheme and intend to vote all of their Shares in favour
of the Scheme.
Peter Robinson, Chairman of the Board of Talison, said, "
Today
marks a significant milestone in the history of Talison. Under the
Scheme, Rockwood is offering cash consideration representing an
attractive premium for Shareholders and allowing Shareholders to realise
immediate value for their Talison Shares. This reflects positively on
Talison's position in the global lithium market."
Macquarie Capital in Australia and Canada are acting as
financial advisor to Talison. A special committee comprised of
independent directors of Talison has received a fairness opinion from
Macquarie Capital, effective on the date hereof, which provides that,
subject to the assumptions and limitations contained therein, the
consideration to be received by Shareholders pursuant to the Scheme is
fair, from a financial point of view, to the Shareholders.
As Talison is an Australian incorporated company listed on
the
Toronto Stock Exchange, the Scheme will be implemented in accordance
with the requirements of the Australian Corporations Act and any
applicable Canadian requirements. Consistent with best practice in
Australia, an Independent Expert will shortly be appointed to opine on
whether the Scheme and the Option Scheme are in the best interests of
Shareholders and Optionholders respectively.
Rockwood is a NYSE-listed global specialty chemicals and
advanced materials company. Rockwood focuses on global niche segments of
the specialty chemicals, pigments and additives and advanced materials
markets.
The expectation of Talison's Directors is that Talison, as
part of the Rockwood group, will continue to support its existing
lithium concentrate customers in China and the rest of the world.
Scheme Details and Timetable
The completion of the Scheme and Option Scheme is subject to minimal conditions including:
- Approval under the Australian Foreign Acquisitions and Takeovers Act 1975 (Cth);
- Regulatory approvals from the Australian Securities and Investments Commission and the Australian Court;
- Approval of the requisite majority of Talison Shareholders at a meeting of Shareholders;
- No Material Adverse Change (as defined in the SIA) occurring to Talison; and
- No Prescribed Occurrence (as defined in the SIA) occurring in relation to Talison.
Further due diligence is not a condition to completion of the Scheme or the Option Scheme.
The SIA contains terms typical for a transaction of this
nature for an Australian incorporated company, including "no shop" and
"no talk" provisions (subject to typical directors' fiduciary duty
exemptions), notification and matching rights.
A mutual break fee ("Break Fee") of C$7 million is also
payable in certain circumstances. Talison is not liable to pay the Break
Fee by reason only of the Scheme not being approved by Talison
shareholders or by the Australian Courts, nor in the event that Talison
Directors withdraw their recommendation for the Scheme as a result of
the Independent Expert finding that the Scheme is not in the best
interests of Talison Shareholders. A Break Fee is payable by Rockwood if
it materially breaches an obligation under the SIA and fails to remedy
such breach. Any payment of the Break Fee will be in full and final
satisfaction of all claims to which the party paying the break fee may
be subject.
Implementation of the Scheme and the Option Scheme will also
be subject to the terms and conditions set out in the Scheme and Option
Scheme documentation when issued.
Further details are included in the executed SIA which is available on SEDAR at
www.sedar.com and on the Talison website
www.talisonlithium.com.
Scheme and Option Scheme booklets will be mailed to
Shareholders and Optionholders. The booklets will contain, among other
things, further information about the Scheme, the Option Scheme, a copy
of the Independent Expert's report and related securityholder meeting
materials. Talison expects that the approval of the Scheme and the
Option Scheme will be put to Shareholders and Optionholders at meetings
expected to be held in October 2012, and that the Scheme and Option
Scheme will be completed shortly thereafter.
Advisors
Macquarie Capital is acting as financial advisor to Talison.
Clayton Utz and Blake, Cassels & Graydon LLP are acting as legal
advisors to Talison.
Cautionary Note Regarding Forward-Looking Statements
Certain information contained in this press release,
including any information as to Talison's mineral reserve and mineral
resource estimates, strategy, projects, plans, prospects, future
outlook, anticipated events or results or future financial or operating
performance, may constitute "forward-looking information" within the
meaning of Canadian securities laws. All statements, other than
statements of historical fact, constitute forward-looking information.
Forward-looking information can often, but not always, be identified by
the use of words such as "plans", "expects", "is expected", "budget",
"scheduled", "estimates", "forecasts", "intends", "anticipates",
"predicts", "potential", "continue" or "believes", or variations
(including negative variations) of such words, or statements that
certain actions, events or results "may", "could", "would", "should",
"might", "potential to", or "will" be taken, occur or be achieved or
other similar expressions concerning matters that are not historical
facts. The purpose of forward-looking information is to provide the
reader with information about management's expectations and plans.
Readers are cautioned that forward-looking statements are not guarantees
of future performance. All forward-looking statements made or
incorporated in this press release are qualified by these cautionary
statements.
Forward-looking statements are necessarily based on a
number of factors, estimates and assumptions that, while considered
reasonable by Talison, are inherently subject to significant business,
economic and competitive uncertainties and contingencies. Such factors,
estimates and assumptions include, but are not limited to: anticipated
financial and operating performance of Talison, its subsidiaries and
their respective projects; Talison's market position; future prices of
lithium or lithium concentrates; estimation of mineral reserves and
mineral resources; realization of mineral reserve and mineral resource
estimates; timing, amount and costs of estimated future production;
grade, quality and content of concentrate produced; sale of production;
capital, operating and exploration expenditures; costs and timing of the
expansion of the Greenbushes Lithium Operations; exploration and
development of the Salares 7 lithium project; costs and timing of future
exploration; requirements for additional capital; government regulation
of exploration, development and mining operations; environmental risks;
reclamation and rehabilitation expenses; title disputes or claims;
absence of significant risks relating to Talison's mining operations;
the costs of Talison's hedging policy; sales risks related to China;
currency; interest rates, and limitations of insurance coverage. While
Talison considers these factors, estimates and assumptions to be
reasonable based on information currently available to it, they may
prove to be incorrect and actual results may vary.
Readers are cautioned that forward-looking information
involves known and unknown risks, uncertainties and other factors which
may cause the actual results, performance or achievements of Talison
and/or its subsidiaries to be materially different from any future
results, performance or achievements expressed or implied by the
forward-looking information. Such risk factors include, amount others,
those described in the unaudited condensed consolidated interim
financial statements of Talison and the related notes thereto as at
March 31, 2012 and for the nine months ended March 31, 2012 and under
the heading "Risk Factors" in the annual information form of Talison for
the year ended June 30, 2011 dated September 23, 2011, each of which
can be found on Talison's SEDAR profile at www.sedar.com.
While Talison considers these assumptions to be reasonable based on
information currently available to it, they may prove to be incorrect
and actual results may vary.
Although Talison has attempted to identify statements
containing important factors that could cause actual actions, event or
results to differ materially from those described in forward-looking
information, there may be other factors that cause actions, events or
results to differ from those anticipated, estimated or intended.
Forward-looking information contained herein is made as of the date of
this press release based on the opinions and estimates of management on
the date statements containing such forward-looking information are
made. Except as required by law, Talison disclaims any obligation to
update any forward-looking information, whether as a result of new
information, estimates or opinions, future events or results or
otherwise. There can be no assurance that forward-looking information
will prove to be accurate, as actual results and future events could
differ materially from those anticipated in such information.
Accordingly, readers should not place undue reliance on forward-looking
information.
