Washington, DC/ Bogota, Colombia, March 17, 2009
—IFC, a member of the World Bank Group, has agreed to invest 12 million Canadian dollars in the equity of Greystar Resources Ltd., supporting an advanced gold and silver exploration project that is expected to provide jobs and government revenues to Colombia once the mine is developed.
IFC’s investment will help fund the
completion of the final technical studies
and the environmental and social preparation work needed to bring
Greystar’s Angostura
project in northeastern Colombia to mine-development stage.
Greystar is a Canadian-based mining company focused on gold and silver exploration in Colombia. It is traded on the Toronto Stock Exchange and the London Stock Exchange’s Alternative Investment Market.
“IFC quickly put together a financing package that meets the needs of our company. We are excited about a long-term partnership with IFC and the benefits of their participation and regard IFC as a key resource on environmental and social issues.”, said David Rovig, president of Greystar.
Greystar is IFC’s first investment in Colombia’s mining sector. Mining is an important component of Colombia’s economy. But, with the exception of coal, it is an industry that has seen limited foreign investment. In 2007, mining represented over 2.5 percent of Colombia’s gross domestic product and over 20 percent of total exports.
"Greystar shares IFC’s commitment to responsible mining operations and engagement with local communities,” said William Bulmer, Global Head for mining at IFC. “This project has the potential to set new environmental and social standards for mining in Colombia and increase the country’s employment opportunities and government revenues."
IFC and Greystar are in preliminary talks to partner on a program that will help local governments in Colombia manage royalty revenues earned from mining. IFC is currently running a similar program in Colombia’s petroleum sector.
IFC’s strategy in Colombia aims to support sectors that are essential to the country’s development. This includes financing infrastructure projects such as ports, roads, and airports that involve public-private partnerships and help improve the country’s competitiveness. Improving access to finance for micro, small, and medium enterprises is also at the core of IFC’s strategy, in addition to helping improve the investment climate by simplifying regulations. As of March 2009, IFC’s total committed portfolio in Colombia was over $1 billion, including syndicated loans.
Legal Disclosure about IFC's Investment
The investment of 12 million Canadian dollars in Greystar will result in IFC acquiring 6,579,161 units issued by Greystar. The units comprise an aggregate of 6,579,161 common shares and 4,934,371 warrants, each of the warrants entitling the holder to purchase one common share of Greystar at an exercise price of 2.47 Canadian dollars per common share for a period of five years from the closing date, subject to earlier expiry in certain circumstances. The issue price per unit is $1.83 Canadian dollars.
Based on the 46,063,798 currently outstanding common shares of Greystar, IFC will own 12.49 percent of the outstanding common shares and, assuming the warrants are exercised in full, 19.99 percent of the outstanding common shares.
The transaction is expected to close by the end of March, 2009.
IFC is acquiring the units for investment purposes as described above. IFC may, in the future, take such actions in respect of its holdings as IFC deems appropriate in light of the circumstances then existing.
To obtain a copy of the report filed with the Canadian securities regulatory authorities in respect of which this news release relates, please contact Hannfried von Hindenburg at the phone number or email address referred to above. IFC’s headquarters are located at 2121 Pennsylvania Avenue, N.W., Washington, D.C., 20433, USA.
About IFC
IFC, a member of the World Bank Group, creates opportunity for people to escape poverty and improve their lives. We foster sustainable economic growth in developing countries by supporting private sector development, mobilizing private capital, and providing advisory and risk mitigation services to businesses and governments. Our new investments totaled $16.2 billion in fiscal 2008, a 34 percent increase over the previous year. For more information, visit
www.ifc.org
.
