Western Canadian Coal Obtains Short-Term Financing To Accelerate The Development Of The Willow Creek Mine
VANCOUVER, April 25 - Western Canadian Coal Corp (TSX: WTN, WTN.WT and WTN.DB and AIM: WTN) (the "Company" or "Western") announces that it has obtained financing from Audley European Opportunities Master Fund Limited ("Audley") for US$ 30 million. The bridge financing will be used to repay the existing project financing facility with the current lending syndicate and allow the Company to accelerate expansion plans at the Willow Creek mine.
"We are very pleased to have Audley come forward in helping us continue to grow the Company. The financing will allow us to immediately start the work required at the Willow Creek Mine and with record coal prices upon us, it was important for the Company to begin production at Willow Creek as soon as possible. The financing today will allow us to commence mining high quality low-volatile PCI coal as soon as September 2008," said John W. Hogg, President and Chief Executive Officer of Western Canadian Coal Corp. "There are also other attractive expansion projects for Western Canadian Coal given current coal prices and we expect to shortly secure other financing to help us meet our capital requirements for the long-term. The company expects to be generating significant positive cash flows within months but the financing now will help us accelerate the development of other projects."
The short-term financing, if not repaid earlier, will be repaid in two tranches with US$ 15 million payable on July 29, 2008 and the balance payable on October 29, 2008. The short-term financing shall accrue interest at a rate of LIBOR plus 450 basis points for the first three months and thereafter until maturity accrue interest at a rate of LIBOR plus 650 basis points. Along with the financing, Audley will be issued warrants to purchase up to four million common shares of the Company at the price of $4.82 per share and will be exercisable for a period of nine months from the date of closing.
The bridge financing is deemed to be related party transactions under the AIM Rules. The independent directors of the Company, having consulted with the Company's nominated advisor consider that the terms of the bridge financing are fair and reasonable as far as the independent shareholders of the Company are concerned.
About Audley
Audley European Opportunities Master Fund is advised by Audley Capital Advisors LLP. A partner of Audley, Mr. Julian Treger, is a member of Western's Board. Audley also holds US$ 30 million of the company's convertible debentures and warrants to purchase up to 2.6 million common shares of the Company. Upon full conversion of all of the Company's convertible debentures, warrants and options, Audley would hold 48,240,000 common shares of the Company, representing approximately 20% of the total number of common shares in the Company.
About Western Canadian Coal
Western Canadian Coal Corp. produces 3.7 million tonnes of high quality metallurgical coal from three mines located in the northeast of British Columbia. The Company also has interests in various coal properties in northern and southern British Columbia and a 50% interest in the Belcourt Saxon Limited Partnership, which was formed to explore and develop the Belcourt and Saxon group of properties in northern BC. Currently, these properties provide the Company with an estimated 15 years of coal reserves at current production levels.
No interests defined.
