Cliffs Natural Resources subsidiary, Cliffs Greene B.V., announces strategic investment in KWG Resources Inc.

    <<
    /NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN
    THE UNITED STATES/
    >>

    CLEVELAND, OH, March 16 /CNW/ - Cliffs Natural Resources Inc. today
announced that its subsidiary, Cliffs Greene B.V. ("Cliffs Greene"), has
acquired, by way of private placement, the following securities issued from
treasury by KWG Resources Inc. ("KWG"): (i) 50,448,987 units of KWG, each unit
comprising one common share of KWG and approximately 0.44 of a common share
purchase warrant of KWG, such that on an aggregate basis Cliffs Greene
acquired 50,448,987 common shares of KWG and 22,224,784 warrants of KWG and
(ii) a non-interest bearing convertible debenture of KWG in the principal
amount of US$1,033,398 maturing on April 16, 2009. One warrant becomes
exercisable for every five common shares issued pursuant to outstanding
warrants, options or other rights to purchase common shares as at January 20,
2009, and entitles Cliffs Greene to acquire one common share at a price of
US$0.05, such price to remain in effect until March 16, 2010 and thereafter at
a price of US$0.10 (subject to the undertaking of KWG to reduce such price to
US$0.05 upon regulatory approval), with all warrants expiring by March 16,
2014 at the latest. Subject to obtaining approval of the shareholders of KWG,
the debenture will automatically convert into units resulting in a further
issuance to Cliffs Greene of 21,135,069 common shares and 9,310,839 warrants,
and in the event that such conditions have not been met before April 16, 2009,
the debenture is required to be repaid.
    The purchase of the units and the debenture result from the exercise by
Cliffs Greene as assignee of an option to purchase securities entered into by
Cliffs Natural Resources Inc. (the assignor and indirect parent of Cliffs
Greene) and KWG dated January 20, 2009. The entering into of the option was
announced by KWG on January 21, 2009.
    The 50,448,987 common shares acquired by Cliffs Greene represent 14.9% of
the total outstanding KWG common shares. Upon the conversion of the debenture,
the additional 21,135,069 common shares into which the debenture is
convertible represent 5.8% of the total KWG common shares then outstanding,
such that, together with the 50,448,987 common shares already held, Cliffs
Greene's aggregate percentage holding of common shares would be 19.9% for a
total of 71,584,056 common shares. The acquisition of common shares pursuant
to the exercise of the warrants (whether the warrants comprised in the units
or the warrants underlying the debenture) will not increase Cliffs Greene's
percentage holding of common shares in KWG beyond 19.9%, such warrants having
been issued for anti-dilutive purposes. KWG has disclosed that the number of
outstanding common shares following the private placement is 338,583,808 and
the number of outstanding warrants is 149,159,629.
    Except for the units and the debenture acquired today, Cliffs Greene does
not own or control any securities of KWG. Accordingly, after completion of the
private placement, Cliffs Greene owns and controls (i) 50,448,987 common
shares representing 14.9% of the total outstanding KWG common shares, (ii)
22,224,784 warrants representing 14.9% of the total outstanding warrants and
(iii) the debenture in the principal amount of US$1,033,398, which upon
conversion will result in Cliffs Greene owning and controlling an additional
21,135,069 common shares, representing 5.8% of the total KWG common shares
then outstanding and together with the 50,448,987 common shares already held,
representing 19.9% of the total outstanding KWG common shares for a total of
71,584,056 common shares, as well as an additional 9,310,839 warrants,
representing 5.8% of the then total outstanding warrants and together with the
22,224,784 warrants already held, representing 19.9% of the total outstanding
warrants for a total of 31,535,623 warrants.
    Cliffs Greene acquired the units at a price of US$0.048893 (C$0.063096)
per unit and acquired the debenture for the principal amount of US$1,033,398
(C$1,333,600) (the debenture being convertible into units at the rate of
US$0.048893 (C$0.063096) per unit), for an aggregate amount of US$3,500,000
(C$4,516,750).
    Cliffs Greene acquired the securities of KWG as a strategic investment.
Upon the conversion of the debenture, Cliffs Greene will be considered to be a
"control person" under the policies of the TSX Venture Exchange. Concurrent to
the closing of the private placement, Cliffs Greene and KWG entered into a
shareholder agreement conferring rights of first refusal and pre-emptive
rights in favour of Cliffs Greene in connection with the issuance of voting
shares or convertible securities by KWG (subject to certain excluded issuances
as provided therein) and the right to designate a representative to the board
of directors of KWG. Subject to restrictions under applicable law, Cliffs
Greene may in the future acquire or dispose of additional securities of KWG
depending on factors such as the business and prospects of KWG and future
market conditions.

    About Cliffs Natural Resources Inc.

    Cliffs Natural Resources is an international mining and natural resources
company. It is the largest producer of iron ore pellets in North America, a
major supplier of direct-shipping lump and fines iron ore out of Australia and
a significant producer of metallurgical coal. With core values of
environmental and capital stewardship, our colleagues across the globe
endeavor to provide all stakeholders operating and financial transparency as
embodied in the Global Reporting Initiative (GRI) framework. Cliffs Natural
Resources is organized through three geographic business units:
    The North American business unit is comprised of six iron ore mines owned
or managed in Michigan, Minnesota and Eastern Canada, and two coking coal
mining complexes located in West Virginia and Alabama. The Asia Pacific
business unit is comprised of two iron ore mining complexes in Western
Australia and a 45% economic interest in a coking and thermal coal mine in
Queensland, Australia. The South American business unit includes a 30%
interest in the Amapa Project, an iron ore project in the state of Amapa in
Brazil, as well as a number of smaller greenfield projects not yet in
production.
    Over recent years, Cliffs has been executing a strategy designed to
achieve scale in the mining industry and focused on serving the world's
largest and fastest growing steel markets.

    About KWG Resources Inc.

    KWG Resources is a mineral exploration company with extensive claim
holdings in the James Bay Lowlands of Northern Ontario, Canada, where
important discoveries of nickel and chrome have been made recently in the
so-called Ring of Fire. KWG has an equal joint venture interest in a large
claim block in the central part of the discovery area, with Spider Resources
Inc. (TSXV: SPQ). The joint venture is developing the Big Daddy chromite
deposit adjacent to the Black Thor and Black Label chromite discoveries of
Freewest Resources Canada Inc. (TSXV: FWR).

For further information: A copy of the Early Warning Report that will be
filed by Cliffs Greene with the relevant Canadian securities commissions in
connection with this matter can be obtained by contacting: Steve Baisden,
Director, Investor Relations and Corporate Communications, (216) 694-5280,
steve.baisden@cliffsnr.com; Christine Dresch, Manager - Corporate
Communications, (216) 694-4052, christine.dresch@cliffsnr.com