Fording and Teck Cominco Announce Receipt of Final Order and Satisfaction of Closing Conditions Regarding Sale of Fording Assets
01 Oktober 2008 - 12:15AM
Marketwired
Fording Canadian Coal Trust (TSX: FDG.UN) (NYSE: FDG) and Teck
Cominco Limited (TSX: TCK.A) (TSX: TCK.B) (NYSE: TCK) today
announced that the Court of Queen's Bench of Alberta has issued its
final order approving the plan of arrangement pursuant to which
Fording will sell all of its assets to Teck and that all required
regulatory approvals for closing have been obtained. Teck has
entered into definitive credit agreements relating to its $9.8
billion bridge and term loan facilities which are being used to
finance Teck's acquisition of the Fording assets. The lenders under
these facilities have confirmed today that all conditions to
borrowing under those facilities have been satisfied, other than
payment of fees by Teck, completion of the 20 trading day
"pre-closing period" as required by the arrangement agreement
between Teck and Fording, initiation and completion of the
transaction implementation procedure under the arrangement
agreement substantially concurrently with the advance of the funds
under the credit facilities and the absence of a "major default"
(as defined in the credit agreements) by Teck prior to closing. A
"major default" is defined as certain limited events relating
primarily to Teck's solvency and the accuracy of certain
representations and warranties provided by Teck, including its
continued existence, the enforceability of the credit agreements
and compliance with laws. The credit agreements have been filed by
Teck on SEDAR and EDGAR.
As a result, Fording and Teck have confirmed to each other that
all conditions to completion of the arrangement have been satisfied
or waived. Today therefore represents the "Transaction Confirmation
Date" for purposes of the arrangement agreement. Under the terms of
the arrangement agreement, the 20 trading day "pre-closing period"
during which Fording's units will continue to trade will commence
on October 1, 2008 and is expected to end on (and include) October
29, 2008. Subject to the exercise of certain limited termination
rights in favour of the parties pursuant to the arrangement
agreement, closing of the arrangement will take place on the
business day following the end of the pre-closing period, which is
expected to be October 30, 2008. The termination rights include the
right to terminate the transaction by mutual consent, the right of
Teck to terminate in the event the amount of residual liabilities
of Fording (net of current assets) exceeds certain agreed levels
either as a result of a wilful violation of the arrangement
agreement by Fording or in circumstances where exceeding such
levels would constitute a material adverse change (as defined in
the arrangement agreement), the right of either party to terminate
if the closing of the arrangement does not occur on or before
December 30, 2008 and the right of either party to terminate if
governmental or regulatory action prohibits the transaction, makes
the transaction illegal or materially and adversely changes the
anticipated tax treatment of the transaction.
Holders of units should be aware of the Canadian income tax
consequences of the arrangement summarized under "Certain Tax
Considerations for Unitholders - Certain Canadian Federal Income
Tax Considerations" in Fording's management information circular
dated September 6, 2008, including the treatment of amounts payable
to holders of units under the arrangement. In particular, for
Canadian federal income tax purposes, Fording expects that all or
substantially all of the distributions and other amounts payable to
holders of units under the arrangement, including all cash amounts
and the fair market value of any Class B subordinate voting shares
of Teck, will constitute ordinary income to holders of units and,
in the case of non-resident holders of units, will be subject to
Canadian non-resident withholding tax. This income inclusion cannot
be offset by capital losses, if any, recognized as a result of the
arrangement. Taxable holders of units who are resident in Canada
and who hold their units on capital account and holders of units
who are not residents of Canada will want to consider disposing of
their units on the Toronto Stock Exchange (the "TSX") or the New
York Stock Exchange ("NYSE") with a settlement date that is prior
to the closing date of the arrangement and should consult their own
tax and investment advisors with regard to this decision. Holders
of units who decide to dispose of their units are advised that: (a)
the TSX is expected to establish special trading rules for the
three trading days preceding the closing date of the arrangement to
facilitate settlement prior to the closing date of trades occurring
on the TSX during that three day period; and (b) the NYSE is
expected to halt trading in the units during the three trading days
prior to the closing date of the arrangement and as such, holders
of units will not be able to trade their units on the NYSE during
such three day period and trades over the NYSE made prior to such
three day period should settle in accordance with the NYSE's
typical T+3 settlement cycle prior to the closing date of the
arrangement.
About Fording
Fording Canadian Coal Trust is an open-ended mutual fund trust
and one of the largest royalty trusts in Canada. Fording holds a
60% interest in the metallurgical coal operations of the Elk Valley
Coal Partnership. Fording's units are traded on the TSX under the
symbol FDG.UN and on the NYSE under the symbol FDG.
About Teck
Teck is a diversified mining company, headquartered in
Vancouver, Canada. Teck's shares are listed on the TSX under the
symbols TCK.A and TCK.B and on the NYSE under the symbol TCK. Teck
is a world leader in the production of zinc and metallurgical coal
and is also a significant producer of copper, gold and specialty
metals. Further information can be found at
www.teckcominco.com.
Forward-Looking Information Advisory
This press release contains forward-looking information within
the meaning of the United States Private Securities Litigation
Reform Act of 1995 and the Ontario Securities Act relating, but not
limited to, Fording's and Teck's expectations, intentions, plans
and beliefs. Forward-looking information can often be identified by
forward-looking or similar words suggesting future outcomes, or
other expectations, beliefs, plans, objectives, assumptions,
intentions or statements about future events or performance.
Readers are cautioned not to place undue reliance on
forward-looking information. By its nature, forward-looking
information involves numerous assumptions, known and unknown risks
and uncertainties, of both a general and specific nature, that
could cause actual results to differ materially from those
suggested by the forward-looking information or contribute to the
possibility that predictions, forecasts or projections will prove
to be materially inaccurate.
These risks include, but are not limited to, a "major default"
under the Teck credit agreements (as described above), the failure
by Teck to obtain sufficient proceeds from the sale of its units of
Fording to complete the arrangement, the amount of residual
liabilities of Fording exceeding certain levels in the
circumstances described above, a material and adverse change in the
anticipated tax treatment of the arrangement, the occurrence of any
event, change or other circumstances that could give rise to the
termination of the arrangement agreement, or the delay of
consummation of the arrangement or failure to complete the
arrangement for any other reason. Fording and Teck caution that the
list of risks and assumptions set forth or referred to above is not
exhaustive. Some of the risks, uncertainties and other factors
which may negatively affect the reliability of forward-looking
information are discussed in Fording's management information
circular dated September 6, 2008, as well as in Fording's and
Teck's respective public filings with the Canadian and United
States securities regulatory authorities, including their most
recent annual information forms, annual reports, management's
discussion and analysis, quarterly reports, material change reports
and new releases. Fording's public filings are available through
Fording's website at www.fording.ca. Copies of Fording's Canadian
public filings are available on SEDAR at www.sedar.com. Fording's
public filings in the United States, including Fording's most
recent annual report on Form 40-F and its filings on Form 6-K, are
available at www.sec.gov. Teck's public filings are available
through Teck's website at www.teckcominco.com. Copies of Teck's
Canadian public filings are available on SEDAR at www.sedar.com.
Teck's public filings in the United States are available at
www.sec.gov. Fording and Teck further caution that information
contained on, or accessible through, these websites is current only
as of the date of such information and may be superseded by
subsequent events, public statements or filings. Neither Fording
nor Teck undertakes any obligation to update publicly or otherwise
revise any information, including any forward-looking information,
whether as a result of new information, future events or other such
factors that affect this information, except as required by
law.
Contacts: Fording Canadian Coal Trust Colin Petryk Director,
Investor Relations (403) 260-9823 Fording Canadian Coal Trust Najda
Dupanovic Coordinator, Investor Relations (403) 260-9892 Email:
investors@fording.ca Website: www.fording.ca Lute & Company
John Lute (416) 929-5883 x222 Email: jlute@luteco.com Teck Cominco
Limited Greg Waller Vice President, Investor Relations &
Strategic Analysis (604) 699-4014 Email:
greg.waller@teckcominco.com Website: www.teckcominco.com
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