Dannemora Mineral investigates alternative to present share issues

Dannemora Mineral AB investigates an alternative financing option to the private placement that an extraordinary general meeting on 26 October 2012 will consider together with a subsequent share issue (repair issue).

A number of Swedish and Finnish shareholders, led by the Finnish asset management company Investo Asset Management Ltd (Investo) has proposed a convertible loan which in that case would replace the proposed share issue (the private placement of 130 million and the repair issue of SEK 20 million). Investor has also committed themselves to subscribe a significant portion of the capital of the proposed loan.

The loan will amount to between 130 and 150 million SEK and runs for three years, with an annual interest rate of 11, 75 percent and a conversion price of 40 SEK.

The loan would, after full conversion, result in a significantly lower dilution of the existing ownership in the company since the conversion price will be 40 SEK compared to the price of the share issues that is 20 SEK.

Provided that the convertible loan can be ensured before the forthcoming extra ordinary General Meeting on 26 October, the General Meeting will be cancelled and the Board will convene a general meeting to consider the convertible loan. Otherwise, the planned General meeting regarding the share issues will be held as planned.