MAJOR MERGER – Noranda, Falconbridge agree to join forces

TORONTO - Two of Canada's best-known miners will soon be one. The boards of NORANDA and FALCONBRIDGE have unanimous...



TORONTO - Two of Canada's best-known miners will soon be one. The boards of NORANDA and FALCONBRIDGE have unanimously agreed to combine the two companies by way of a share exchange bid by Noranda. The deal will simplify the ownership structure, boost market capitalization, and facilitate future growth. Noranda held approximately 59% of Falconbridge before the announcement, and the management of the two companies was virtually the same.

Each Falconbridge shareholder will receive 1.77 Noranda shares for each Falconbridge share, which represents a 15% premium to the 20-day average share price for the period ending March 7, 2005. Each existing Noranda common share will represent one share of the new combined entity. Prior to the Merger, Noranda will offer to repurchase 63.4 million of its common shares, in exchange for three series of junior preferred shares of the company (the "issuer bid") with an aggregate stated value of US$1.25 billion.

BRASCAN, the owner of approximately 41% of Noranda common shares, has indicated that it will tender its common shares to the US$1.25-billion issuer bid. On completion of the merger and issuer bid, Brascan's ownership position will decline to between 16% and 26% of the new entity.

No shareholder vote or other approvals will be required to complete the issuer bid. More information is posted at and

Last September Noranda and state-owned CHINA MINMETALS announced that they had entered into exclusive talks concerning the takeover of Noranda by Minmetals. The period of exclusivity has expired, and the two sides are still talking. The talks involve creating a strategic alliance that may involve commercial arrangements regarding certain development projects, assistance with procurement and supply of equipment and other products and services in regard to certain greenfield projects, joint exploration initiatives in China and other matters.


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