Silver Wheaton Corp.
Largest Pure Silver Streaming Company
Message: Capstone Agrees to Support Silver Wheaton's Premium Offer for Silverstone
| March 12, 2009 |
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Capstone Agrees to Support Silver Wheaton's Premium Offer for Silverstone
24.0 Million Shares and 2.7 Million Special Warrants to be Exchanged at Ratio of 0.185 Silver Wheaton Shares |
| VANCOUVER, BRITISH COLUMBIA--(Marketwire - March 12, 2009) - Capstone Mining Corp. (TSX:CS) today announced that it has entered into a voting agreement (the "Agreement") with Silver Wheaton Corp. (TSX:SLW) whereby Capstone has agreed to vote its shares in favour of the proposed plan of arrangement between Silverstone Resources Ltd. (TSX VENTURE:SST) and Silver Wheaton whereby Silver Wheaton will acquire all of Capstone's shares and special warrants in Silverstone at a ratio of 0.185 shares of Silver Wheaton per common share or special warrant of Silverstone held by Capstone. "Silver Wheaton's offer for Silverstone represents a significant premium to Silverstone's recent share price and allows Capstone to exchange its approximately 26.8 million shares and special warrants into 4.95 million shares of Silver Wheaton," said Stephen Quin, President & COO of Capstone Mining. "The transaction gives Capstone exposure to a larger, more liquid investment in a broad spectrum of silver streams from world class projects across the world. Assuming a successful completion of the Arrangement, Capstone would retain its exposure to precious metal production through its holdings in Silver Wheaton, while increasing the financial flexibility of its holdings," he said. "Capstone looks forward to a strong and on-going business relationship with Silver Wheaton, and hopes to work with Silver Wheaton on other transactions in the future. We believe Silver Wheaton's size and financial capacity should enhance Capstone's ability to continue its growth strategy, working together on suitable development or production opportunities that have precious metal by-product streams." Silver Wheaton Offer for Silverstone As announced March 12, 2009, Silver Wheaton has made an offer to combine with Silverstone, by way of plan of arrangement (the "Arrangement"), by exchanging 0.185 of a Silver Wheaton share for each common share and special warrant of Silverstone. Capstone owns 24,042,340 common shares of Silverstone and 2,747,428 special warrants, which are convertible into common shares of Silverstone on a one-to-one basis at no additional charge, representing 26,789,768 shares of Silverstone in total, following conversion. Upon completion of the Arrangement, Capstone would own 4,956,107 shares of Silver Wheaton. Completion of the Arrangement is subject to certain conditions as set out in a joint press release between Silver Wheaton and Silverstone dated March 12, 2009. The Agreement with Silver Wheaton was negotiated by the President and COO of Capstone and approved by a special committee of the board of directors of Capstone comprised solely of directors with no interest in Silverstone or Silver Wheaton, namely Colin Benner, Bruce McLeod and Stephen Quin. Haywood Securities Inc. acted as advisers to the special committee and DuMoulin Black LLP as legal counsel. Conflicted management and directors involved in Silverstone or Silver Wheaton recused themselves from all discussions in respect of the Agreement. The Agreement commits Capstone to vote in favour of the Arrangement, to not solicit other offers for its Silverstone shares and to assist Silver Wheaton in completing the Arrangement. In the event Silverstone receives a superior proposal to the Arrangement that is accepted by Silverstone and Silver Wheaton does not match the superior proposal, the Agreement would terminate. Capstone is not receiving any additional consideration for entering into the Agreement. |
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