Forbes Coal Exposes Dissidents' Disruptive Tactics and False
Allegations; Recent RCF Comments Contradict Own Representative on
Forbes Coal Board
TORONTO, ONTARIO -- (Marketwire) -- 09/27/12 -- Forbes & Manhattan
Coal Corp. (TSX:FMC)(JSE:FMC) ("Forbes Coal" or the "Company") wishes
to respond to the inaccurate information that is being suggested by
Resource Capital Fund V LP ("RCF") in its press release of September
On September 24, 2012, Forbes Coal announced that it had entered into
a definitive agreement with Rio Tinto PLC pursuant to which it will
acquire 100% ownership of the shares and shareholder claims of
Riversdale Mining Limited (not Riverside Mining Limited, as noted in
the press release disseminated by the dissident shareholders) in
Riversdale Holdings (Proprietary) Limited ("Riversdale") (the
On September 26, 2012, RCF issued a press release suggesting that it
was inappropriate for the current board of directors to agree to
acquire Riversdale at this time. Forbes Coal believes that this is
-- RCF is well aware that the Forbes Coal board of directors, which
includes a representative of RCF, unanimously approved the Transaction
well in advance of the shareholders meeting held on September 17, 2012.
-- Forbes Coal announced the Transaction earlier this week once the
definitive agreement with Rio Tinto was finalized and entered into.
However, on July 24, 2012, the board of directors of Forbes Coal,
including the RCF representative on the board, unanimously authorized
the Company to negotiate, finalize and execute a binding offer letter
and definitive agreement in respect of the Transaction.
-- There was no inappropriate behaviour on the part of Forbes Coal or the
board of directors and to suggest otherwise is simply false.
-- Forbes Coal believes that the press releases being issued by the
dissident shareholders are an attempt to deviate management's attention
and its resources from executing on the Company's strategy.
Stephan Theron, the President and Chief Executive Officer of Forbes
Coal, states "the Company is focused on executing its strategy and
creating value for all shareholders. The smear campaign embarked on
by the dissident shareholders could cause severe harm to the Company
and artificially depress the share price. We can only speculate that
this must be the dissidents' motivation in an effort to position
themselves advantageously for any future acquisition of the Company."
In addition, the September 26, 2012 press release is inaccurate as
the dissident shareholders did not secure overwhelming shareholder
support for their proposed slate of directors. Forbes Coal wishes to
reiterate that the decision to disallow invalid proxies was in
accordance with the Proxy Protocol, which the dissidents requested be
followed. Forbes Coal will not comment further at this time as this
matter is before the Court.
About Forbes Coal
Forbes Coal is a growing coal producer in southern Africa. It holds a
majority interest in two operating mines through its 100% interest in
Slater Coal (Pty) Ltd., a South African company ("Slater Coal") which
has a 70% interest in Zinoju Coal (Pty) Ltd. ("Zinoju"). Zinoju holds
a 100% interest in the Magdalena bituminous mine and the Aviemore
anthracite mine in South Africa (collectively, "the Slater
Properties"). The mines have a substantial resource base and each
mine has a projected life span in excess of 20 years. Forbes Coal is
in the process of increasing production at both mines and looks to
triple production from 2010 levels in the next three years using
existing infrastructure and capacity. The Company has in-place
transportation infrastructure allowing its coal to reach both export
corridors and the growing domestic coal market. Forbes Coal has a
strong balance sheet and an experienced coal-focused management team.
Please refer to the Company's NI 43-101 compliant technical report on
the Slater Properties dated March 1, 2011 entitled "Technical Report
on Slater Coal and Subsidiaries, KwaZulu-Natal Province, South
Africa", available on the SEDAR profile of the Company at
www.sedar.com. Additional information is available at
Johan Odendaal, B.Sc.(Geol.), B.Sc.(Hons)(Min. Econ.), M.Sc. (Min.
Eng.), a director of Minxcon and an independent Qualified Person, as
defined in National Instrument 43-101 has reviewed and approved the
scientific and technical information contained in this release.
The ability of the Company to increase production amounts has not
been the subject of a feasibility study and there is no certainty
that the proposed expansion will be economically feasible.
This press release contains "forward-looking information" within the
meaning of applicable Canadian securities legislation.
Forward-looking information includes, but is not limited to,
statements with respect to the anticipated production results with
respect to the Slater Properties, future financial or operating
performance of the Company and its projects, statements regarding the
anticipated improvements in logistical support and anticipated
improvements in sales, statements made with respect to prospects for
the business of the Company, requirements for additional capital,
government regulation of the mineral exploration industry,
environmental risks, acquisition of mining licences, title disputes
or claims, limitations of insurance coverage and the timing and
possible outcome of pending litigation and regulatory matters.
Generally, forward-looking information can be identified by the use
of forward-looking terminology such as "plans", "expects" or "does
not expect", "is expected", "budget", "scheduled", "estimates",
"forecasts", "intends", "anticipates" or "does not anticipate", or
"believes", or variations of such words and phrases or state that
certain actions, events or results "may", "could", "would", "might"
or "will be taken", "occur" or "be achieved". Forward-looking
information is subject to known and unknown risks, uncertainties and
other factors that may cause the actual results, level of activity,
performance or achievements of the Company to be materially different
from those expressed or implied by such forward-looking information,
including but not limited to: general business, economic,
competitive, foreign operations, political and social uncertainties;
a history of operating losses; delay or failure to receive board or
regulatory approvals; timing and availability of external financing
on acceptable terms; not realizing on the potential benefits of the
proposed transaction; conclusions of economic evaluations; changes in
project parameters as plans continue to be refined; future prices of
mineral products; failure of plant, equipment or processes to operate
as anticipated; accidents, labour disputes and other risks of the
mining industry; and, delays in obtaining governmental approvals or
required financing or in the completion of activities. Although the
Company has attempted to identify important factors that could cause
actual results to differ materially from those contained in
forward-looking information, there may be other factors that cause
results not to be as anticipated, estimated or intended. There can be
no assurance that such information will prove to be accurate, as
actual results and future events could differ materially from those
anticipated in such statements. Accordingly, readers should not place
undue reliance on forward-looking information. The Company does not
undertake to update any forward-looking information, except in
accordance with applicable securities laws.
Forbes & Manhattan Coal Corp.
President and Chief Executive Officer
+1 (416) 861-5912
Forbes & Manhattan Coal Corp.
VP Corporate Development
+1 (416) 861-5811
Press spacebar to pause and continue. Press esc to stop.