TSX: WTN, WTN.DB and AIM: WTN
VANCOUVER, Feb. 26 /CNW/ - Western Canadian Coal Corp (TSX: WTN and
WTN.DB and AIM: WTN) ("WCCC" or the "Company") announces that it has entered
into an amendment to the terms of the conditional agreement (the "Agreement")
between the Company and Cambrian Mining plc ("Cambrian") for the sale of Falls
Mountain Coal Inc. ("FMC") to Western by Cambrian previously announced on
December 3, 2007.
Under the previously announced terms, Cambrian will sell FMC to Western
for consideration consisting of 18,740,898 common shares of Western and a
deferred payment of $14,055,673 at Cambrian's election to be paid in cash or
by the issuance of 9,000,000 common shares of Western.
In view of the significant appreciation of the Company's share price
since the November 30, 2007 date of the conditional agreement, Western and
Cambrian have agreed to amend the agreement to reduce the number of shares to
be issued in the event the deferred payment is at Cambrian's election made in
shares, from 9,000,000 common shares to 4,534,088 common shares of Western. In
addition, the completion of the sale of FMC will be conditional upon Western
having obtained all necessary regulatory and shareholder approvals for the
agreement previously announced on December 3, 2007 to amend the conversion
rate under the $5 million convertible loan which Western agreed to in exchange
for Cambrian waiving its rights to repayment of its loan, setting the interest
rate at 8.5% per annum, waiving payment of a $125,000 fee and releasing the
security granted in respect of the loan.
The completion of the sale of FMC to Western is also conditional on the
parties obtaining all necessary consents and approvals, including shareholder
approval, regulatory approval, consents of the relevant lenders to the Company
and Cambrian and approval by Cambrian's Board of Directors. Both parties have
agreed to obtain such approvals by March 31, 2008. The Agreement is deemed to
be related party transaction under the AIM Rules. The independent directors of
the Company, having consulted with the Company's nominated advisor, consider
that the revised terms of the Agreement are fair and reasonable as far as the
independent shareholders of the Company are concerned.
Cambrian is a diversified mining house that manages and supports
operations in coal and gold/antimony mining. It also has extensive exposure to
energy projects and related technologies, from oil shale assets through to
alternative energy projects, as well as exposure to traditional oil and gas
exploration and development.
Cambrian has been instrumental in the past three years in supporting the
development of a number of mines and moving them into production. These
include: the Augusta gold and antimony mine in Victoria, Australia; the
2.4 million tonnes per annum Wolverine hard coking coal mine in Western
Canada; the Dillon and Brule PCI mines in Western Canada as well as
underground metallurgical coal and underground and surface thermal coal mines
in West Virginia, USA.
Cambrian, through its wholly-owned subsidiaries, currently holds
approximately 48.4 million common shares of Western, representing
approximately 42% of Western's issued and outstanding shares. Mr. John Byrne,
Chairman of Western, is also Chairman of Cambrian and holds approximately 7.2%
of the outstanding shares of Cambrian. Mr. John Conlon, a director of Western,
is also a director of Cambrian and holds approximately 1.0% of the outstanding
shares of Cambrian.
About Western Canadian Coal
Western Canadian Coal Corp. produces 3.1 million tonnes of high quality
metallurgical coal from two mines located in the northeast of British
Columbia. The Company also has interests in various coal properties in
northern and southern British Columbia and a 50% interest in the Belcourt
Saxon Limited Partnership, which was formed to explore and develop the
Belcourt and Saxon group of properties in northern BC. Currently, these
properties provide the Company with an estimated 25 years of coal reserves at
current production levels.
For further information:
For further information: David Jan, Manager, Investor Relations &
Corporate Development, Phone: (604) 608-2692, Email: email@example.com