Jaguar announces intention to launch take-over bid for HudBay

    TORONTO, Nov. 21 /CNW/ - Jaguar Financial Corporation or an affiliate
("Jaguar" or the "Company") (TSX: JFC) today announced its intention to make
an offer (the "Offer") to acquire all of the issued common shares ("Shares")
of HudBay Minerals Inc. ("HudBay"). Jaguar will offer two series of notes as
consideration for the Shares. The Shares trade on the Toronto Stock Exchange
under the symbol "HBM". Jaguar is a shareholder of HudBay.
    The consideration offered under the Offer will consist of two series of
variable principal amount notes. The first series (the "Series 1 Notes") will
entitle the holder to a pro rata portion of the cash resources of HudBay, less
a management fee of 1% payable to Jaguar and a cash holdback for HudBay's
working capital purposes pending the sale of HudBay's assets. The Series 1
Notes will be redeemed 10 business days of Jaguar acquiring all of the HudBay
shares not already owned by Jaguar. Jaguar estimates the value of the Series 1
Notes to be approximately $5.40 per share.
    The second series of notes (the "Series 2 Notes") will entitle the holder
to a pro rata portion of the proceeds of the sale of the remaining assets of
HudBay, less a management fee of 1% payable to Jaguar. Payments will be made
on the Series 2 Notes from time to time within 10 business days after the sale
of any substantial asset of HudBay. Subject to meeting all regulatory and
stock exchange requirements, Jaguar will take steps to have the Series 2 Notes
listed and posted for trading on one of the Toronto Stock Exchange ("TSX") or
the TSX Venture Exchange.
    The Offer will be conditional on, among other things, the deposit of that
number of Shares which, when taken together with the Shares already owned by
Jaguar, constitutes at least 50% of the Shares plus one Share. The Offer will
also be conditional on the cancellation of the transaction between HudBay and
Lundin Mining Corporation ("Lundin"), the cancellation of the proposed loan by
HudBay to Lundin in the amount of $135,800,000 and the cancellation of the
related private placement and share purchase agreement, all described in the
joint press release of HudBay and Lundin issued today.
    Mr. Vic Alboini, Jaguar's Chairman and Chief Executive Officer stated:
"The proposed HudBay - Lundin combination is an embarrassing value destructive
transaction. The Jaguar offer will return cash to the HudBay shareholders as
well as monetize the value of its assets to return more cash to the HudBay
shareholders."
    Jaguar will request a shareholders list from HudBay and, when received,
Jaguar will send the Offer documents to HudBay's shareholders. Jaguar intends
to commence the Offer on or about December 8, 2008, at which time the Offer
documents will be filed with applicable securities regulatory authorities and
copies will be delivered to HudBay. Copies of the Offer documents will also be
available on SEDAR at www.sedar.com.

    The Purpose of the Offer

    The proposed business combination between HudBay and Lundin is not in the
best interests of HudBay's shareholders. Based on Jaguar's review of HudBay's
publicly available information, HudBay is cash flow positive and has estimated
net cash resources of $844 million as at September 30, 2008. Jaguar estimates
that HudBay's business, excluding cash resources, could be worth up to $300
million. Based on disclosure as at January 1, 2008, HudBay had total in-mine
reserves of approximately 21.4 million tonnes of ore, in-mine resources of
approximately 3.5 million tonnes of ore. Based on HudBay's disclosure, it also
has pre-development properties with resources of approximately 338 million
tonnes and reserves of 41.4 million tonnes.
    HudBay is a cash rich company with extremely low operating costs with
copper production at $0.35 per pound and zinc production at $0.32 per pound.
    In contrast, Lundin appears to have a serious solvency problem and it is
unclear whether Lundin is able to further drawdown on its credit facility.
Lundin had approximately US$240 million in debt as at September 30, 2008.
Further, Lundin's assets are of significantly lower quality than HudBay's
assets. Lundin's Neves-Corvo and Aljustrel properties were recently put on
care and maintenance and it appears that Lundin's Aquablanca and Galmoy
properties are at risk of also being put on care and maintenance.
    Lundin has a 25% interest in Tenke Fungurume mine which is located in the
Democratic Republic of Congo (the "DRC"). The DRC is currently a very high
risk jurisdiction in which to conduct business as a result of significant
ongoing political instability and armed conflict. This situation in the DRC
does not appear to be improving over the short term. The proposed transaction
with Lundin will divert HudBay's capital away from high quality assets located
in jurisdictions where there is virtually no political risk, to lower quality
assets in a jurisdiction with extremely high political risk.
    The purpose of the Offer is to acquire all of the common shares of HudBay
not already owned by Jaguar. If the Offer is completed, including the
completion of any compulsory acquisition transaction, Jaguar will take steps
to cause HudBay to cease to be a reporting issuer.
    The joint press release of HudBay and Lundin announcing the proposed
combination states that that the consideration Lundin shareholders will
receive under the transaction represents a premium of approximately 32% to the
30 day volume weighted average trading price ("VWAP") of Lundin's shares on
the TSX based on HudBay's 30 day VWAP on the TSX. Based on the closing price
of Lundin and HudBay shares on the TSX on November 20, 2008, Jaguar calculates
that the premium offered to Lundin shareholders is significantly higher and
represents approximately 103%. In Jaguar's view, such a premium is unjustified
given the lower quality of Lundin's assets compared with HudBay's assets and
given the Lundin debt level. Further, HudBay's shares today closed at $3.16,
down 39.58% while Lundin's shares closed up 3.96% at $1.05.
    Jaguar may, depending on market and other conditions, acquire additional
Shares, through market transactions, private agreement or otherwise, subject
to applicable securities laws. Jaguar may, depending on market or other
conditions, sell any or all of its Shares.

    About Jaguar

    Jaguar is a Canadian merchant bank that invests in undervalued small
capitalization companies in a variety of industry sectors.

    The Toronto Stock Exchange does not accept responsibility for the
adequacy or accuracy of this news release. This press release may contain
forward-looking statements with respect to the Company, its operations,
strategy, financial performance and condition. These statements generally can
be identified by use of forward looking words such as "may", "will", "expect",
"estimate", "anticipate", intends", "believe" or "continue" or the negative
thereof or similar variations. The actual results and performance of the
Company discussed herein could differ materially from those expressed or
implied by such statements. Such statements are qualified in their entirety by
the inherent risks and uncertainties surrounding future expectations.
Important factors that could cause actual results to differ materially from
expectations include, among other things, general economic and market factors,
and competition. The cautionary statements qualify all forward-looking
statements attributable to the Company and persons acting on their behalf.
Unless otherwise stated, all forward-looking statements speak only as of the
date of this press release and the Company has no obligation to update such
statements.

For further information: on this press release, please contact: Vic
Alboini, Chairman & Chief Executive Officer, (416) 644-8110; or Kyler Wells,
General Counsel & Corporate Secretary, (416) 644-8177