March 05, 2013 09:16 ET
Advanced Explorations Inc. Engages ICBC International Capital Limited as Financial Advisor
TORONTO, ONTARIO--(Marketwire - March 5, 2013) - Advanced Explorations Inc. (the "Company" or "AEI") (TSX VENTURE:AXI)(FRANKFURT:AE6) today announced that it has engaged ICBC International Capital Limited ("ICBCI") as its lead financial advisor in Hong Kong for the purpose of the Proposed Capital Financing (as defined below). AEI has engaged ICBCI to assist its preparation for a valuation, based on the valuation report to be issued by relevant third party independent technical experts, that is to form the basis of a proposed capital financing (the "Proposed Capital Financing") for a joint venture to be set up by AEI and XinXing Ductile Iron Pipes Co., Ltd. ("XDIP", together with AEI, the "JV Partners") for the Roche Bay project (the "Proposed JV"). ICBCI will also explore with the JV Partners the feasibility for consolidation of all AEI's iron ore assets (Tuktu, Tuktu-2 and Roche Bay) as part of asset injection into the Proposed JV. Should this proposal be accepted, an expansion of the financing structure would be required along with a revision to the framework agreement between the JV Partners. AEI has concluded this engagement with the consultation and support of XDIP.
ICBCI's primary focus is to work within China's regulatory and financing framework to secure the Proposed Capital Financing. ICBCI is a subsidiary of the Industrial and Commercial Bank of China Ltd. ("ICBC"), one of the world's largest banks by capitalization as at the date of this press release. Given the breadth of ICBCI's expertise, AEI and XDIP will benefit greatly from the advice and development scenarios presented by ICBCI. With global markets substantially discounting resources projects, these advisory services allow an external party to properly value AEI's assets and to put a definitive financing solution in place.
The Company has been focused on optimizing the Feasibility Study to further reduce capital and operating cost. Recent announcements with respect to port and LNG power partnerships are but two examples that will have a positive impact on the project financials. Further optimization of the Roche Bay development plans include updating the expected project revenues based on a higher grade concentrate (>68% Fe) than was used in the FS marketing study and to expand the measured and indicated resource base to support a mine life greater than 25 years. The larger resource base will also allow AEI to model a development scenario at an 8 mtpa start-up which, through improved economy of scale, should further reduce the per tonne FOB operating cost. ICBCI will assist AEI in providing the associated updated financial models in connection with the Proposed Capital Financing.
John Gingerich, President & CEO, commented:
"We are extremely pleased to conclude the engagement with ICBCI that follows from 10 months of discussions on the various strategies/plans in respect to the proposed capital financing for the Roche Bay AEI-XDIP mine plan and potentially larger regional development scenarios. Through this process, a strong working relationship has evolved between the ICBCI and AEI teams. AEI is proud to have secured the interest and support of a prominent financial advisor recognized in China and around the world. By engaging one of the world's largest banks which has an institutional investor client base in China, AEI will have solid financial guidance so as to move ahead on an expedited basis. We believe this relationship to be the jumping off point from which we can regain significant market capitalization."
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