VANCOUVER, Jan. 18 /CNW/ - Norsemont Mining Inc. ("Norsemont")
(TSX-V: NOM; Frankfurt: N8S; WKN: A0DQKK; OTC-BB: NOMFF; ISIN: CA6565291045)
is very pleased to announce it has secured a non-brokered private placement of
$14,000,000 with institutional investor The Sentient Group. The company is
concurrently finalizing an additional financing of up to $2,000,000 from
insiders, associates and institutional investors.
The private placement was first announced in Stockwatch on December 18,
2005. The amended terms are that Norsemont will issue up to 4,000,000 units at
a price of $4.00 per unit. Each unit will consist of one common share and
one-half of one common share purchase warrant, with each whole warrant
entitling the holder to purchase one additional common share for two years at
a price of $4.75 per share. The Warrants will have an "accelerator" provision
such that if the closing price of Norsemont's common shares is $6.00 or higher
for 10 consecutive trading days at any time after the closing date, Norsemont
may, by issuance of a press release and written notice to the holders, give
notice of "acceleration" of the warrant expiry date to the day which is
20 calendar days following the date of issuance of the press release.
The Sentient Group of funds will be subscribing for a total of
3,500,000 units of the private placement for a total of $14,000,000. This
transaction is expected to close within 3 days subject to final Exchange
acceptance.
Norsemont President & CEO, Marc E. Levy said: "We're delighted that a
quality investor such as The Sentient Group has recognized the value of our
asset at Constancia. Sentient is an exceptional group for us to partner with
and they are determined to see our Constancia project move towards production.
This is a considerable milestone for Norsemont to have achieved in less than
twelve months since optioning the Constancia property from Rio Tinto. We are
proud to attract such an outstanding financial partner to help in developing a
first-class project such as Constancia. The Sentient Group has a long term
approach to investing, is actively involved and able to provide strategic and
long term planning advice. Their extensive experience in mining will provide
Norsemont with additional resources to ensure our success."
Norsemont is pleased to have attracted multiple suitors who were prepared
to fund the company. After completing a detailed review of the two main offers
the board decided to accept a significantly larger offer at a marginally
reduced price so that it will have sufficient funds to ensure the execution of
its plans for Constancia and Amata. Although the placement with Sentient Group
was discounted slightly when compared to the other offer, yet still above the
existing market, the Board decided to go with Sentient for a number of
reasons, including a 40% increase in the size of the offer, a reduction to
a 1/2 warrant, an expedient closing and their long term strategic approach.
The financing proceeds will be used to fund the company's anticipated
work programs on the Constancia project and Amata project, for investigation
of asset acquisition activities and general working capital. A finder's fee
will be payable on all or a portion of the private placement according to the
TSX Venture Exchange policies including a fee payable to Allied Capital
Corporation.
Securities issued pursuant to the private placement will be subject to a
four-month hold. The private placement is subject to acceptance for filing by
the TSX Venture Exchange.
As well, Norsemont Mining Inc. has granted 400,000 incentive stock
options to certain employees, directors and consultants, exercisable at
$4.00 per share. The options are exercisable for a period of five years from
the date of grant in accordance with the terms of the company's plan. The
grant is subject to the policies of the TSX Venture Exchange.
The Sentient Global Resources Fund is a 10-year closed-end private equity
fund based in the Cayman Islands, investing principally in the development of
natural resource based projects. The Fund consists of a Limited Partnership
and a parallel Australian Trust, which invest pro-rata in the Fund's
investments.
The Fund's sponsors are CDP Capital, Babcock & Brown and HypoVereinsbank.
The Fund's investors range from government pension plans, corporate pension
funds, institutional investors and industry participants. The global spread of
investors from the USA, Canada, Germany and Australia complements its global
mandate. For more information visit their web site at www.thesentientgroup.com
Norsemont Mining is a well-structured and financed exploration company
working in the America's, with a focus on Peru. The Company is currently
drilling the Constancia Cu-Au-Mo project, and commencing exploration at the
Amata Ag-Au property acquired from Rio Tinto.
Marc E. Levy,
Director & President
The TSX Venture Exchange has not reviewed and does not accept
responsibility for the adequacy or the accuracy of this release. We seek
Safe Harbor.
