http://www.timminspress.com/ArticleD...
Liberty on hold
Posted By BRANDON WALKER, THE DAILY PRESS
Posted 2 hours ago
Officials with Liberty Mines are anxiously awaiting the result of a deal for financing to keep the company afloat.
President and CEO Gary Nash is hopeful $30 million in financing by Chinese company Jilin Jien Nickel will come through.
"I can't say a lot until this closes, but the bottom line is without this deal Liberty wouldn't have any options," Nash said.
It won't be long before the company knows the result of months spent trying to get help.
In October, Liberty announced it was curtailing development at its Redstone Mine, southeast of Timmins, because of poor nickel market conditions.
An undisclosed number of employees and contractors were affected by the move.
In November, employees received a letter stating they would not receive their final pay until "completion of the financial support package."
As of yesterday, they still hadn't received their final pay-cheques.
The company also announced in November its board had appointed a special committee made up of independent directors to consider alternatives.
Fourteen companies were contacted to try to obtain expressions of financing interest.
JJN offered the only package which meets the company's needs, he said.
Nash said Liberty will focus on its McWatters Nickel Mine project, southeast of Timmins, if the deal is a success.
"We want to get going on (McWatters) right away. It'll be there for many, many years."
If the deal goes through, Jilin Jien Nickel will own 51 per of the common shares of Liberty. If all preferred shares were converted, JJN would own 76.8 per cent of the common shares.
An additional 272,727,273 common shares issued will represent a 331 per cent dilution of the currently outstanding common shares.
Through a press release, Nash said the financing will be dilutive to existing shareholders.
"We are fortunate to be able to complete a sizeable financing during the current base metal commodity price crisis," he said.
Nash said having JJN as a major shareholder and strategic partner will put Liberty on the path to becoming a "mid-tier" nickel producer.
