RIO DE JANEIRO, BRAZIL--(Marketwire - March 31, 2008) - MMX MINERACAO E METÁLICOS S.A.
("MMX" or the "Company") (BOVESPA: MMXM3) (
Mr. Eike Batista, controlling shareholder of MMX, certain members of the management of MMX and Anglo American Participações em Mineração Ltda. ("Anglo American Brazil"), a wholly owned subsidiary of Anglo American plc ("Anglo American"), entered into a Share Purchase and Sale Agreement ("Agreement") on this date, whereby Anglo American Brazil agreed to purchase, and Mr. Eike Batista and certain members of management of MMX agreed to sell, common shares representing approximately 63.47% of the share capital of IronX Mineração S.A. ("IronX").
IronX is a corporation currently in the process of obtaining its publicly held company registration before the Brazilian Securities Commission (the Comissão de Valores Mobiliários or the "CVM"), and, after the conclusion of a corporate reorganization of MMX ("Reorganization"), IronX will be the owner of 51% of the share capital of MMX Minas-Rio Mineração S.A. ("MMX Minas-Rio") and 70% of MMX Amapá Mineração Ltda. Anglo American currently owns, indirectly, 49% of MMX Minas-Rio, as well as 49% of LLX Minas-Rio Logística Comercial Exportadora S.A., and the remaining 51% of the share capital of LLX Minas-Rio Logística Comercial Exportadora S.A. will continue to be held by LLX Logística S.A. ("LLX"). The Reorganization will also involve the transfer to IronX of 100% (one hundred per cent) of the stock capital of MMX Metálicos Amapá Ltda. and Bay Service Serviços Portuários Ltda.
I - Reorganization of MMX
A Reorganization of MMX will be carried out in preparation for the acquisition of IronX ("Acquisition"). Such Reorganization will be submitted to the approval of its shareholders and duly disclosed to the market in additional detail, in accordance with CVM Instruction 319/99. If approved, the Reorganization will involve the spin-off of MMX with the transfer of portions of its assets and liabilities to IronX and LLX. IronX has already filed with the São Paulo Stock Exchange (Bolsa de Valores de São Paulo - BVSP or "Bovespa") a request for listing in the Novo Mercado segment, and LLX will also join the Novo Mercado segment in due time, as a consequence of the Reorganization.
As a result of the Reorganization, the shares of MMX in IronX and LLX will be distributed directly to the shareholders of MMX, in the same proportion of their equity interests in the share capital of MMX. Consequently, as a result of the Reorganization the shareholders of MMX will own shares in each of the three companies, receiving one new share issued by IronX and LLX for each share issued by MMX held by them.
The shareholders of MMX who disagree with the Reorganization may exercise their withdrawal rights and will be entitled to the reimbursement of the book value of the shares effectively owned until the close of trading of Bovespa on the business day immediately preceding the earlier date between (i) the date of publication of the Notice to Investors regarding the Reorganization, or (ii) the date of publication of the call notice of the general shareholders' meeting of MMX to approve the Reorganization. Shares purchased from such date onwards, will not confer withdrawal rights to their holders. The reimbursement amount will be the value of the shares of MMX, based on the shareholders' equity of MMX, as informed in its most recent financial statements, approved in the general shareholders' meeting, which corresponds to: (i) R$119.98 per share, based on the current number of shares of MMX; or (ii) R$5.95 per share, if the proposal to split each share of MMX into 20 shares is approved in the extraordinary general meeting of the Company to take place on April 7th, 2008.
II - Acquisition
The total purchase price will be the amount in reais equivalent to US$5,518,547,123.63 for all of the issued and outstanding shares of IronX, including the shares owned by Mr. Eike Batista and the shares issued pursuant to the stock option plan of MMX, as well as the shares owned by other selling shareholders in accordance with the terms of the Agreement. The purchase price above mentioned is equivalent to (i) the equivalent in reais to US$361.12 per share, based on the current number of shares of MMX, after exercise of the outstanding options granted by MMX; or (ii) the equivalent in reais to US$18.056 per share, if the proposal for the stock split of MMX's shares is approved in the general meeting to take place on April 7th, 2008, and further assuming a ratio of 1 IronX share for each MMX share outstanding on the date of the Reorganization, as well as the issuance of 1,027,200 new IronX common shares after the date of the Reorganization, in furtherance of management incentive options. The purchase price will be paid in reais, on the closing date of the Acquisition.
III - Mandatory Tag-Along Offer
Considering that the Acquisition will result in the transfer of control of IronX, Anglo American Brazil or Anglo American will launch a tender offer for the common shares held by the remaining IronX shareholders, in accordance with the terms and conditions of article 254-A of Brazilian Corporate Law, CVM Instruction No. 361 and item 8.1 of the Rules of the Novo Mercado issued by Bovespa ("Tag-Along Offer"), at the same price per share paid for the controlling shares, i.e.: (i) the equivalent in reais to US$ 361.12 per common share, based on the current number of shares of MMX, after exercise of the outstanding options granted by MMX; or (ii) the equivalent in reais to US$18.056 per common share if the stock split proposal of MMX is approved, and further assuming a ratio of 1 IronX share for each MMX share outstanding on the date of the Reorganization, as well as the issuance of 1,027,200 new IronX common shares after the date of the Reorganization, in furtherance of management incentive options.
According to a formal communication filed by Anglo American Brazil at the headquarters of the Company today, MMX hereby informs the markets that Anglo American Brazil or Anglo American has the intention to execute, concurrently to the Tag-Along Offer, a delisting offer of IronX, as well as an offer to withdraw from Novo Mercado segment. If the valuation made according to the laws and regulations applicable to the delisting offer and the offer to withdraw from the Novo Mercado determines an amount per share higher than the price paid to the Controlling Shareholder, Anglo American or Anglo American Brazil will decide whether to proceed with the offer to de-list and to withdraw IronX from the Novo Mercado, thus accepting to pay the higher price per share to minority shareholders, or to withdraw from such offers, keeping the tag-along offer only.
IV - Continuation of the MMX and LLX businesses as publicly-held companies, listed on the Novo Mercado of Bovespa.
In accordance with the terms of the First notice to Investors, and as long as Mr. Eike Batista remains the controlling shareholder of MMX and LLX, MMX will remain his exclusive vehicle for mining projects in general, and LLX will be the vehicle for ports and logistic infrastructure projects. As part of the Reorganization, MMX will:
(i) have the option to own a participation of 50% in the first pelletization plant, with capacity of 7.5 million tons per year, to be built in Açu Port; and
(ii) receive a payment equivalent to 2.415% of the EBITDA (excluding Selling, General and Administrative Expenses but including the Stay in Business Capital Expenditures, as defined in the respective agreement) of MMX Minas-Rio, limited to US$ 50 million annually, and 3.276% of the EBITDA (duly adjusted as defined in the respective agreement) of MMX Amapá, limited to US$ 14 million annually.
These payments will be due between 2025 and 2049 for MMX Minas-Rio and between 2023 and 2047 for MMX Amapá.
VI - Other conditions to which the transaction is subject
In addition to certain other conditions that are customary in transactions of this nature, in order to carry out the Reorganization, IronX, LLX and MMX must obtain the relevant approvals from their shareholders in a shareholders' meeting, called in accordance with the Law and the regulation issued by the CVM. The Acquisition is subject to registration of the Tag-Along Offer before CVM and to its completion by Anglo American Brazil.
The process will be notified to the competent antitrust bodies, while MMX, IronX and LLX will keep their shareholders and the market timely and sufficiently informed of all the steps of the transaction until conclusion.
Luiz Rodolfo Landim Machado Executive President and Investor Relations Officer MMX Mineração e Metálicos S.A.