Silvercorp Metals announces takeover offer for OreCorp

Silvercorp Metals and OreCorp have entered into a Bid Implementation Deed, or BID, pursuant to which Silvercorp has agreed to acquire, by means of an off-market takeover offer, all of the OreCorp Shares not already owned by Silvercorp for consideration comprising 0.0967 common shares of Silvercorp and A$0.19 cash per OreCorp Share, currently equivalent to A$0.5891 per OreCorp Share. Under the BID, Silvercorp and OreCorp have provided undertakings to each other to facilitate the transaction. The offer is subject to minimal conditions, including: Silvercorp having a relevant interest in at least 50.1% of the OreCorp Shares; no regulatory action which could reasonably be expected to restrain, impede or prohibit the offer and completion of the transaction; no OreCorp material adverse change or prescribed occurrence and normal course listing approval for the new Silvercorp Shares to be issued. The OreCorp board is unanimously recommending that OreCorp shareholders accept the Offer subject to their Independent Expert’s Report concluding, and continuing to conclude, that the offer is reasonable to OreCorp shareholders and there being no superior proposal. Subject to those same qualifications, the OreCorp board, who collectively hold 3.94% of the OreCorp Shares, intend to accept the offer in respect of all OreCorp Shares they own or control. Silvercorp said it is well-positioned to fund and immediately move to advance Nyanzaga towards commercial production. The development of the Nyanzaga Project is also subject to regulatory and jurisdiction risks in Tanzania. For example, the Government of Tanzania currently holds a 16% non-dilutable free carried interest in the share capital of Sotta Mining Corporation Limited, or SMCL. In addition, the Government of Tanzania has a right to acquire, in total, up to 50% of the share capital of SMCL, determined by the total value of the tax expenditures enjoyed by SMCL. However, relevant legislation also provides that the Government of Tanzania agrees and undertakes that any increase in ownership or economic participation rights by the Government of Tanzania in addition to the 16 percent Free Carried Interest Shares will be by agreement between the parties, and that the Government of Tanzania will not unilaterally seek to increase such ownership or economic participation rights. Silvercorp has designed, permitted and constructed multiple mining and processing facilities, requiring it to establish and maintain constructive relationships with diverse stakeholders, including communities, regulators, and various levels of government. Silvercorp looks forward to bringing its philosophy of openness, transparency and cooperation in its future dealings with the Government of Tanzania to facilitate the prompt development of Nyanzaga for the benefit of all involved.