Cambior converts loan to shares

Jipangu, a private Japanese investment company oriented toward the gold sector, has agreed to subscribe to a private placement of 15 million common shares of Cambior (CBJ-T) priced at US42 each, or US$6.3 million in total.

The per-share price represents a 73% premium over the closing price of Cambior’s shares on the Toronto Stock Exchange on Dec. 20, 2000.

On closing, Jipangu will hold about 22% of Cambior’s outstanding shares on an undiluted basis.

Cambior intends to apply the proceeds to the repayment, in part, of Jipangu’s US$10-million mortgage loan in respect of Cambior’s 50% interest in the Niobec mine. The move will reduce the loan to US$3.7 million.

In July, Cambior arranged a US$13-million mortgage on its half-interest in the Niobec niobium mine in Chicoutimi, Que. Under the deal, Jipangu provided Cambior with US$10 million, while an unnamed financial institution footed the remaining US$3 million.

The proceeds were used to pay down Cambior’s remaining US$17.2 million of a US$75-million commitment due on June 30.

The latest deal is subject to regulatory approval and the closing of both a new $65-million credit facility and a $55-million prepaid gold forward sale agreement, part of Cambior’s recently approved debt restructuring plan.

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