AMG Subsidiary Timminco provides further update on financing arrangements

Amsterdam, 28 April 2009 — AMG Advanced Metallurgical Group N.V.’s (“AMG,” EURONEXT AMSTERDAM: “AMG”) 50.7% owned subsidiary, Timminco Limited (“Timminco”; TSX: TIM), announced today that it has entered into a subscription agreement with its controlling shareholder, AMG to purchase approximately 7.4 million common shares at a price of C$2.02 per share for aggregate gross proceeds of C$15.0 million.  This transaction is expected to be completed on or about April 30, 2009.  As a result of the transaction, AMG will own approximately 63.9 million common shares of Timminco, representing 53.8% of Timminco’s total issued and outstanding share capital.  Proceeds of the financing will be used for general corporate purposes, which include the repayment of monies drawn on the Timminco’s revolving line of credit.

 

The price per share agreed upon with AMG is equal to the market value of a Timminco common share, as determined pursuant the Toronto Stock Exchange (“TSX”) definitions, namely, the volume weighted average trading price of such shares on the five trading days last week.  This pricing formula was agreed upon by the independent designated representatives of the boards of directors of each of Timminco and AMG.  Timminco believes there would be insufficient demand from other investors to participate in this offering and, accordingly, has decided to proceed with a non-brokered transaction to AMG only.

 

“The additional capital from this financing will enable us to better manage uncertainties associated with short-term demand from Timminco’s solar grade silicon customers, and potential risks with outstanding customer deposits,” said Mr. Robert J. Dietrich, Executive Vice President – Finance and Chief Financial Officer of Timminco.

 

Given the size of the offering, the transaction must be approved by a majority of disinterested shareholders.  Timminco has obtained written consents from a majority of disinterested shareholders, permitting it to proceed with the offering of common shares to AMG on the terms and price as described above.

 

Completion of this transaction is subject to certain conditions, including receipt of all necessary regulatory approvals, including the approval of the TSX.  The common share issued pursuant to this private placement will be subject to a four-month hold period from the date of closing.

 

AMG, incorporated in the Netherlands, is a global leader in the production of highly engineered specialty metal products and advanced vacuum furnace systems.  AMG serves growing industries worldwide with its unique combination of metallurgical engineering expertise and production know-how.  AMG is a market leader in many of its products and systems, which are critical to the production of key components for the aerospace, energy (including solar and nuclear), electronics, optics, chemicals, construction and transportation industries.  AMG has two operating divisions of businesses, Advanced Materials and Engineering Systems, and owns majority interests in publicly-listed companies Timminco Limited (TSX: “TIM”) and Graphit Kropfmühl AG (Deutsche Börse: GKR.DE). 

 

The Advanced Materials Division develops and produces niche specialty metals and complex metals products, many of which are used in demanding, safety-critical, high-stress environments.  AMG is one of a limited number of significant producers globally of niche specialty metals, such as ferrovanadium, ferronickel-molybdenum, aluminum master alloys and additives, chromium metal and ferrotitanium, used by steel, aluminum, chemical and superalloy producers for aerospace, automotive, energy, electronics, optics, chemicals, construction and other applications.  Other key products produced by AMG include specialty alloys for titanium and superalloys, coating materials, tantalum and niobium oxides, vanadium chemicals and antimony trioxide.

 

The Engineering Systems Division designs, engineers and produces advanced vacuum furnace systems and operates vacuum heat treatment facilities.  AMG is a global leader in supplying technologically-advanced vacuum furnace systems to customers in the aerospace, energy (including solar and nuclear), transportation, electronics, superalloys and specialty steel industries.  Examples of furnace systems produced by AMG include vacuum remelting, solar silicon melting and crystallization, vacuum induction melting, vacuum heat treatment and high pressure gas quenching, vacuum precision casting, turbine blade coating and sintering.  AMG also provides vacuum case-hardening heat treatment services on a tolling basis to customers through facilities equipped with vacuum heat treatment furnaces.

 

Timminco Limited is a majority controlled, publicly listed subsidiary of AMG. Timminco is a leader in the production of upgraded metallurgical silicon for the rapidly growing solar photovoltaic energy industry.  Timminco also produces silicon metal and magnesium products for use in a broad range of industrial applications.

 

Graphit Kropfmühl AG is a majority controlled, publicly listed subsidiary of AMG.  Based on its secure raw material sources in Africa, China and Europe, Graphit Kropfmühl is a specialist in the production of silicon metal and the extraction, processing and refining of natural crystalline graphite for a wide range of energy saving industrial applications. 

 

AMG operates globally with production facilities in Germany, the United Kingdom, France, Czech Republic, the United States, Canada, Mexico, Brazil, Sri Lanka and Australia and also has sales and customer service offices in Belgium, Russia, China and Japan (website: www.amg-nv.com). 

 

 

 

 

 

 

Certain statements in this press release are not historical facts and are “forward looking.”  Forward looking statements include statements concerning AMG’s plans, expectations, projections, objectives, targets, goals, strategies, future events, future revenues or performance, capital expenditures, financing needs, plans and intentions relating to acquisitions, AMG’s competitive strengths and weaknesses, plans or goals relating to forecasted production, reserves, financial position and future operations and development, AMG’s business strategy and the trends AMG anticipates in the industries and the political and legal environment in which it operates and other information that is not historical information.  When used in this press release, the words “expects,” “believes,” “anticipates,” “plans,” “may,” “will,” “should,” and similar expressions, and the negatives thereof, are intended to identify forward looking statements.  By their very nature, forward looking statements involve inherent risks and uncertainties, both general and specific, and risks exist that the predictions, forecasts, projections and other forward looking statements will not be achieved.  These forward looking statements speak only as of the date of this press release.  AMG expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward looking statement contained herein to reflect any change in AMG’s expectations with regard thereto or any change in events, conditions or circumstances on which any forward looking statement is based.

 

AMG Subsidiary Timminco provides further update on financing arrangements