Dannemora's bond loan creates flexibility and added value

            Dannemora's bond loan creates flexibility and added value


Last week's bond loan of USD 120 million has secured the loan financing for the
resumption of Dannemora Mineral's iron ore mine in Uppland. This means that the
Company is already initiating work on all urgent investment projects. Dannemora
Mineral will also accordingly attain the objective of commencing operations in
the spring of 2012.

"The time-saving is one of the decisive advantages of our choice of the type of
financing. Now we will be able to start production much quicker, resulting in
that Dannemora Mineral can derive maximum benefit from the high iron ore prices
and thereby reduce the financial risk. We also believe that this will facilitate
negotiations and the conclusion of contracts with the steelworks' clients while
strengthening the position of Dannemora in terms of negotiations with equipment
suppliers. The Company's future recruitments will also be facilitated as the
entire funding is in place," comments the Company's CEO, Staffan Bennerdt.

The Company is also well-prepared since it already has a project organisation in
place to conduct investments, which include a new sorting plant, overground and
underground infrastructure and a lift for the main shaft.

"All in all we believe that the type of financing we have chosen definitely
benefits the Company and shareholders despite being more expensive in the short-
term than a bank loan. This is due to the fact that it guarantees an earlier
operational start and secures positive cash flows quicker," adds Staffan
Bennerdt.

The bond loan is for five years and the Company has the option of repaying the
loan after two, three or four years at a rate of 106, 104 and 102 per cent
respectively. The coupon rate is 11.75 per cent. The loan is subject to
Dannemora Mineral also strengthening its capital by a minimum of SEK 100
million.

In order to fulfil the condition of strengthening its capital Dannemora Mineral
is planning a new issue of class B shares. The Company is now examining the
possibility of a targeted issue of a minimum of SEK 100 million for
institutional investors.

Given that the financing of the iron ore project in Dannemora has now been
secured, the Company will investigate the prerequisites for listing the
Company's class B shares on one of the regulated lists of the Stockholm Stock
Exchange, Small Cap or Mid Cap.
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