GREAT WESTERN MINERALS GROUP ANNOUNCES CLOSING OF
US$90 MILLION CONVERTIBLE BOND FINANCING
NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES
April 5, 2012 – Saskatoon, Canada: Great Western Minerals Group Ltd. (“GWMG” or the “Company”, TSX.V: GWG) today announced the closing of its previously announced offering (the “Offering”) of US$80 million of secured convertible bonds (the “Bonds”). In addition, GMP Securities L.P. and ISM Capital LLP, as co-lead agents, together with Byron Capital Markets Ltd. (collectively the “Agents”), exercised an over-allotment option of US$10 million, resulting in the issuance of Bonds in the aggregate principal amount of US$90 million.
The Bonds bear interest at the rate of 8.0% per annum, are payable semi-annually, mature on April 6, 2017, and are convertible into common shares of the Company (“GWMG Shares”) at a conversion rate of C$0.66 per share. The Bonds are secured obligations of the Company that have a first charge against the Company’s shareholdings in its various operating subsidiaries in the United Kingdom, the United States and South Africa.
The net proceeds raised from the Offering will be used: (i) to complete a technical report on the Company’s Steenkampskraal property in accordance with National Instrument 43-101 - Standards of Disclosure for Mineral Projects; (ii) to advance the development of the Company’s Steenkampskraal development project; (iii) for the construction of the Company’s monazite processing facility; (iv) for the construction of the Company’s separation facility; (v) for equipment purchases and expansion of Less Common Metals Limited; and (vi) for general working capital purposes.
The Agents were paid a cash commission of US$3.6 million. The Bonds and any GWMG shares issuable upon the conversion thereof are subject to a four month hold period, under applicable Canadian securities legislation, which expires on August 6, 2012.
The TSX Venture Exchange (the “TSXV”) has conditionally accepted the listing of the GWMG Shares issuable upon the conversion of the Bonds pursuant to the Offering. Listing of the GWMG Shares issuable upon the conversion of the Bonds is subject to, inter alia, the Company fulfilling the standard final requirements of the TSXV.
GWMG President and Chief Executive Officer Jim Engdahl said, “Successfully closing the US$90 million Offering is an immensely important step in the GWMG story. Even moreso, the fact that the Offering was fully subscribed, including the full exercise of the over-allotment option, speaks volumes about the interest of investors in GWMG and the confidence they have in our company being one of the most fully integrated ‘first movers’ in the global rare earth business.”
