Sherritt International Corporation and Dynatec Corporation Announce Closing of Arrangement


    TORONTO, June 14 /CNW/ - Sherritt International Corporation ("Sherritt" -
TSX:S) and Dynatec Corporation ("Dynatec" - TSX:DY) today announced the
completion of the Plan of Arrangement (the "Arrangement"). Pursuant to the
Arrangement, Sherritt has acquired all of Dynatec's issued and outstanding
common shares.
    The Arrangement was approved at the special meeting of shareholders of
Dynatec on June 8, 2007, and received Ontario Superior Court of Justice
approval on June 12, 2007. Under the terms of the Arrangement and related
steps, shareholders of Dynatec receive 0.19 of a Sherritt common share and
approximately 0.0635 of a common share of FNX Mining Company Inc. for each of
their Dynatec common shares.
    Through the transaction, Sherritt now owns a 45% interest in, and will
operate, the Ambatovy nickel project in Madagascar. When fully operational,
Ambatovy will produce 60,000 tonnes (100% basis) of nickel and 5,600 tonnes
(100% basis) of cobalt per year with an estimated reserve life of 27 years.
The project is scheduled to be commissioned in 2010 and running at full
capacity by 2012. Sherritt will leverage its world-leading expertise in
lateritic nickel production to optimize the construction and development of
Ambatovy, a lateritic mine. As a result, Sherritt is well positioned to remain
a low-cost lateritic nickel producer, with long-term gross annual nickel
production from the combined company expected to be 109,000 tonnes (100%
basis) by 2012.
    "The combination of Sherritt's proven track record in mining, processing
and refining lateritic ore in Moa, Cuba, and the ongoing phased Metals
expansion - which will increase capacity by 50% to approximately 49,000 tonnes
- uniquely positions Sherritt as the most capable operator to build out and
operate the Ambatovy project," said Sherritt's President and CEO, Jowdat
Waheed. "Once Ambatovy and our expansion in Cuba are both operating, we will
be among the lowest-cost nickel producers in the world, and well positioned to
capitalize on the growing demand for the metal over the long term. At the same
time, we are aggressively pursuing growth initiatives in Oil & Gas, Coal and
Power, in order to build value across all business units."
    Furthermore, the transaction will strengthen Sherritt's Technologies
business with the addition of Dynatec's experienced Metallurgical Technologies
division. The combined Technologies group is well positioned for future growth
and its expertise will be leveraged to support Sherritt's other growth
    No Sherritt common shares are being issued to U.S. persons holding
Dynatec common shares. Instead, a mechanism has been established pursuant to
which Sherritt common shares otherwise issuable to U.S. persons pursuant to
the Arrangement will be issued to a trustee. The trustee will sell such shares
on the Toronto Stock Exchange ("TSX") and remit the proceeds (net of selling
expenses and applicable withholdings) to such persons.
    Three business days after June 14, 2007 - the date the Arrangement was
completed - certificates of Sherritt and FNX shares will be distributed to
Dynatec shareholders.
    Upon issuance of a Bulletin of the TSX confirming receipt by the TSX of
all necessary documents in connection with the closing of the Arrangement and
related matters, the common shares of Dynatec will be de-listed from the TSX
on or after June 15, 2007.
    Sherritt is currently negotiating the sale of Dynatec's Mining Services
division to FNX, as outlined in a separate agreement between Sherritt, Dynatec
and FNX, whereby FNX was granted a right, subject to closing of the
transaction, to purchase said division from Sherritt for cash at a price based
upon independent assessments of value.
    More information about the Arrangement is available in Dynatec's
Management Information Circular (the "Circular") available on SEDAR at and on Dynatec's website at Dynatec shareholders
may be interested in deferring possible taxes associated with the Arrangement.
Details on how to elect for such a deferral can be found in the Circular and
can also be obtained at or by calling 

    About Sherritt

    Sherritt International Corporation is a diversified resource company
involved in the production of thermal coal, nickel, cobalt, oil and
electricity. Its success is built on utilizing innovative technologies and the
breadth of its financial and operational expertise to increase productivity
and profitability. Sherritt continues to explore opportunities to grow its
$2.7 billion asset base through expansion of its existing businesses and
strategic acquisitions. Sherritt's shares are listed on the TSX under the
symbol "S".
    In addition to its significant nickel production, Sherritt operates and
owns 41.2% of Royal Utilities Income Fund, the largest thermal coal producer
in Canada. Sherritt currently produces over 30,000 barrels of oil equivalent
per day and has 376 megawatts of power generation capacity.

    About Dynatec

    Recently acquired by Sherritt International Corporation, Dynatec
Corporation became a growing mining company with extensive mining and
metallurgical expertise developed over many years as a leading service
provider to the mining industry. To create shareholder value, Dynatec applied
its mining and metallurgical expertise to attractive ownership opportunities.
Dynatec had three principal growth assets in its portfolio: the large-tonnage
Ambatovy nickel laterite project in Madagascar; a 24.4% ownership interest in
FNX Mining Company and a coal-bed methane lease arrangement in West Virginia
that was at the pilot production stage.

    Forward-looking Statements

    This news release contains forward-looking statements. Forward-looking
statements generally can be identified by the use of statements that include
words such as "believe", "expect", "anticipate", "intend", "plan", "likely",
"will" or other similar words or phrases. Similarly, statements contained in
each of the "Outlook" sections of this news release including those with
respect to expectations concerning assets, prices, foreign exchange rates,
earnings, production, market conditions, capital expenditures, commodity
demand, risks, availability of regulatory approvals, corporate objectives and
plans or goals, are or may be forward-looking statements. These
forward-looking statements are not based on historic facts, but rather on
current expectations, assumptions and projections about future events. These
forward-looking statements are subject to known and unknown risks,
uncertainties and other factors that are beyond the Corporation's ability to
control or predict. Actual results and developments may differ materially from
those contemplated by this news release depending on, among others, such key
factors as business and economic conditions in Canada, Cuba and the principal
markets for Sherritt's products.
    Key factors that may result in material differences between actual
results and developments and those contemplated by this news release also
include the supply, demand and prices for Sherritt's products; dependence on
significant customers; deliveries; production levels, production and other
anticipated and unanticipated costs and expenses; energy costs; premiums or
discounts realized over LME cash and other benchmark prices; interest rates;
foreign exchange rates; rates of inflation; changes in tax legislation; the
timing, capital costs and financing arrangements associated with development
projects; the timing of the receipt of government and other approvals;
political unrest or instability in the countries where Sherritt is active;
risks related to collecting accounts receivable and repatriating profits and
dividends from Cuba; risks related to foreign exchange controls on Cuban
government enterprises to transact in foreign currency; risks associated with
the United States embargo on Cuba and the Helms-Burton Act; risks associated
with mining, processing and exploration activities; potential imprecision of
reserve estimates; market competition; developments affecting labour
relations; environmental regulation and other risk factors listed from time to
time in Sherritt's continuous disclosure documents such as its annual report,
annual information form and management information circular.
    The Corporation does not intend, and does not assume any obligations, to
update these forward-looking statements.

    %SEDAR: 00008191E

For further information:

For further information: Michael Minnes, (416) 935-2468,; or Mark Utting, (905) 780-1980 x329,

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