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YAMANA OFFERS EARLY EXERCISE TO HOLDERS OF PUBLICLY TRADED WARRANTS |
06/17/2005 |
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Download this Press Release (PDF 25 KB)
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YAMANA GOLD INC. (TSX: YRI; AMEX: AUY; LSE (AIM): YAU) is pleased to announce that it has filed a preliminary short form prospectus in each of the provinces of Canada for the distribution of common shares relating to the early exercise of its publicly traded warrants. The warrants are exercisable at a strike price of C$1.50 until July 31, 2008 and the Company is encouraging the early exercise of those warrants. The warrants are listed on the TSX and AMEX under the symbols YRI-WT and AUY.WS.
Yamana is proposing an amendment to the terms of the warrants that would entitle holders of record as of a specified date to receive an additional 0.0356 of a common share upon the early exercise of their warrants provided that the exercise occurs within a 30-day period from an effective date to be established for this purpose. Based on recent trading prices for the Company’s common shares, this represents a premium of more than $0.16 per warrant. Assuming the exercise of all outstanding warrants, the Company will issue an additional 1,444,209 common shares upon the early exercise of warrants representing, on a fully diluted basis, 0.8% of the outstanding shares. Yamana will cause a compulsory exchange of unexercised warrants for common shares if at least 2/3 of warrant holders exercise their warrants on these terms.
This transaction is intended to simplify the Company’s capital structure and management is of the view that the transaction is beneficial to both warrant holders and shareholders. There are presently approximately 40.6 million warrants outstanding. These warrants represent a meaningful portion of public float and market capitalization which is not recognized in the Company’s market capitalization. The warrants effectively now represent and trade as a separate class of equity and this transaction would simplify the Company’s capital structure by absorbing that equity class into common shares thereby increasing the overall public float, liquidity and market capitalization of the Company. Subject to the receipt of all required warrant holder, shareholder and regulatory approvals, this transaction would also generate gross proceeds of as much as $60.9 million which would otherwise not be available to the Company until 2008.
The proposed transaction is subject to warrant holder and shareholder approvals. The proposed meetings of warrant holders and shareholders are expected to be held on or around July 28, 2005. Yamana will be mailing information circulars to both warrant holders and shareholders in early July. The transaction requires a 2/3 approval by warrant holders and a simple majority approval by disinterested warrant holders. It also requires a simple majority approval by disinterested shareholders. Santa Elina Mines Corporation, which currently owns 15.9 million warrants representing approximately 39.3% of the class, has agreed to vote in favour of the proposal and to exercise its warrants on the terms outlined above. Santa Elina Mines Corporation also owns approximately 24 million common shares representing approximately 19.5% of the class.
A copy of the preliminary short form prospectus dated June 17, 2005 relating to the proposed transaction can be found at www.sedar.com or obtained from the Company at the following address:–
Yamana Gold Inc.
150 York St., Suite 1902
Toronto, Ontario Canada
M5H 3S5
Phone: (416) 815-0220
e-mail: investor@yamana.com
A registration statement relating to these securities has been filed with the Securities and Exchange Commission but has not yet become effective. These securities may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of these securities in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state.
BMO Nesbitt Burns Inc. is acting as financial advisor to Yamana with respect to the proposal.
Yamana is a Canadian gold producer with significant gold production, gold and copper-gold development stage properties, exploration properties and land positions in all major mineral areas in Brazil. Yamana expects to produce gold at intermediate company production levels by 2006 in addition to significant copper production by 2007. Yamana also holds gold exploration properties in Argentina. Company management plans to build on this base by targeting other gold consolidation opportunities in Brazil and elsewhere in Latin America. As at March 31, 2005, Yamana had cash balances totaling US$66.2 million.
For further information, contact
Peter Marrone
President & Chief Executive Officer
(416) 815-0220
E-mail: investor@yamana.com
FORWARD-LOOKING STATEMENTS: This news release contains certain "forward-looking statements" within the meaning of Section 21E of the United States Securities Exchange Act of 1934, as amended. Except for statements of historical fact relating to the company, 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 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. These factors include the inherent risks involved in the exploration and development of mineral properties, the uncertainties involved in interpreting drilling results and other cological data, fluctuating metal prices, the possibility of project cost overruns or unanticipated costs and expenses, uncertainties relating to the availability and costs of financing needed in the future and other factors. The Company undertakes no obligation to update forward-looking statements if circumstances or management’s estimates or opinions should change. The reader is cautioned not to place undue reliance on forward-looking statements.
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