The Board of Directors of Freewest Resources Canada Inc. (TSX
VENTURE: FWR) has unanimously recommended that Freewest
shareholders reject the revised "final" offer by Noront Resources
Ltd. for all of the common shares of Freewest and not tender their
shares to the Noront offer. The Board's recommendation is contained
in a Notice of Change to Directors' Circular filed on SEDAR.
The Notice of Change contains the Board's recommendation and a
detailed discussion of its reasons for recommending that Freewest
shareholders reject the revised "final" offer from Noront. Freewest
shareholders are urged to read the Notice of Change in its
entirety.
In making its recommendation, the Board considered many factors,
including the recommendation of a Special Committee comprised of
Freewest's independent directors and advice from CIBC World Markets
Inc., Freewest's financial advisor.
"We have entered into an arrangement agreement with Cliffs
Natural Resources Inc. which provides Freewest shareholders, for
each Freewest share, with a fixed amount of $0.90 in Cliffs shares.
The Board believes that this guaranteed consideration from Cliffs
is vastly superior to the offer from Noront" said Mackenzie I.
Watson, President, Chief Executive Officer and a director of
Freewest. "We recommend that shareholders vote for the arrangement
with Cliffs and reject the inferior Noront offer."
Under the revised Noront offer, Noront is offering, for each
Freewest share, 0.2857 of a Noront common share and 0.1429 of a
Noront common share purchase warrant, exercisable for five years at
an exercise price of $4.00.
The Board of Directors unanimously concluded that the
consideration provided by revised Noront offer is inadequate, from
a financial point of view, to Freewest shareholders. The Board of
Directors unanimously recommends that Freewest shareholders REJECT
the revised offer from Noront and NOT TENDER their common shares to
the Noront offer.
As announced by Freewest on December 3, 2009, Freewest and
Cliffs Natural Resources Inc. have entered into an amendment to
their Arrangement Agreement, under which Freewest shareholders will
receive, for each Freewest share, a fixed amount of $0.90 in Cliffs
shares. The Board of Directors unanimously recommends that Freewest
shareholders APPROVE the Arrangement with Cliffs at a special
meeting of Freewest shareholders to be held on January 15,
2010.
Reasons for the Recommendation
The Freewest Board of Directors believes that the revised Noront
offer fails to provide full value for Freewest's assets and shares
and is an attempt by Noront to acquire Freewest without offering
adequate consideration to Freewest shareholders. The Board of
Directors cited a number of reasons for its recommendation,
including that:
- The proposed arrangement with Cliffs will provide a fixed
value of $0.90 per Freewest share.
- The value of the consideration offered under the revised
Noront offer is uncertain and primarily dependent on the value of
Noront's shares, which are subject to significant fluctuations.
- The value of the consideration offered under the revised
Noront offer is dependent in part on the value of the Noront
warrants, which is uncertain.
- The implied value of $0.86 per Freewest share of the revised
Noront offer is not substantiated.
- It may be difficult for Freewest shareholders to dispose of
Noront shares and Noront warrants.
- The revised Noront offer is coercive.
- The Board of Directors continues to believe that the Noront
offer fails to adequately compensate Freewest shareholders for the
strategic value of Freewest's assets.
- The Board of Directors continues to believe that the timing of
the Noront offer is opportunistic and disadvantageous to Freewest
shareholders.
- Noront does not have a strategy focused on chromite.
Availability of the Notice of Change to Directors' Circular
Shareholders are urged to read the Notice of Change in its
entirety. The document is available free of charge on SEDAR at
www.sedar.com and on Freewest's website at www.freewest.com. Copies
of the Notice of Change are being mailed to all Freewest
shareholders.
For Investor Questions, Including How to Withdraw Shares from
the Noront Offer
Shareholders who have questions or who may have already tendered
their shares to the Noront offer and wish to withdraw them, may do
so by contacting Georgeson at the toll free number set out
below.
About Freewest
Freewest is a mineral exploration company actively exploring for
gold, base-metals and chromite within eastern Canada. Corporate
information can be accessed on the Internet at www.freewest.com.
Freewest's shares are listed on Tier 1 of the TSX Venture Exchange
under the symbol FWR.
Georgeson Inc. is acting as Freewest's solicitation agent in
connection with a proposed Plan of Arrangement with Cliffs Natural
Resources Inc. Georgeson may be contacted as follows:
Georgeson
100 University Avenue
11th Floor, South Tower
Toronto, Ontario
M5J 2Y1
North American Toll Free Number: 1-866-433-7579
Banks and Brokers Collect Number: 1-212-806-6859
Forward-Looking Statements
This news release contains statements that constitute
"forward-looking information" or "forward-looking statements"
within the meaning of applicable securities legislation. This
forward-looking information is subject to numerous risks and
uncertainties, certain of which are beyond the control of Freewest
Resources Canada Inc. ("Freewest"). Actual results or achievements
may differ materially from those expressed in, or implied by, this
forward-looking information. No assurance can be given that any
events anticipated by the forward-looking information will
transpire or occur, or if any of them do so, what benefits that
Freewest will derive therefrom. In particular, no assurance can be
given as to whether a proposed plan of arrangement with Cliffs
Natural Resources Inc. will be completed. Forward-looking
information is based on the estimates and opinions of Freewest's
management at the time the information is released and Freewest
does not undertake any obligation to update publicly or to revise
any of the forward-looking statements, whether as a result of new
information, future events or otherwise, except as may be required
by applicable securities laws.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
Contacts: Freewest Resources Canada Inc. Mackenzie I. Watson
President and CEO (514) 878-3551 or 1-888-878-3551 (514) 878-4427
(FAX) Email: info@freewest.com Website: www.freewest.com
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