Stornoway Closes Private Placement of Units
VANCOUVER, BRITISH COLUMBIA--(Marketwire - April 19, 2012) -Stornoway Diamond Corporation (TSX:SWY) -
NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES
Stornoway Diamond Corporation ("Stornoway" or the "Corporation") is pleased to announce the closing of a private placement with Stornoway's largest shareholder, Diaquem Inc., an indirect wholly-owned subsidiary of Investissement Qu?bec, for aggregate gross proceeds of $5,097,950 (the "Private Placement").
The Private Placement was completed as a result of the exercise by Diaquem Inc. of its pre-emptive right, and upon the same terms as the units issued by the Corporation pursuant to a public offering which closed on March 28, 2012. Under the Private Placement, a total of 5,097,950 units of the Corporation (the "Units") were sold at a price of $1.00 per Unit. Each Unit consists of one common share and one-half of one common share purchase warrant of the Corporation. Each whole warrant entitles the holder to purchase one common share of the Corporation at a price of $1.20 per share at any time on or before April 21, 2014. As a result of the Private Placement, Diaquem Inc. now holds 25% of the Corporation's issued and outstanding common shares. The closing price of the common shares of the Corporation on the TSX on the date of this announcement is $0.86.
The securities issued upon the closing of the Private Placement will be subject to a hold period of four months and one day from closing.
The proceeds from the Private Placement will be used to fund pre-development expenditures at the Renard Diamond Project for the 2012 calendar year and for general corporate purposes.
The securities referred to herein have not been and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any offer, solicitation or sale of the securities in any state in which such offer, solicitation or sale would be unlawful.​
About the Renard Diamond Project
The Renard Diamond Project is located approximately 250 km north of the Cree community of Mistissini and 350 km north of Chibougamau in the James Bay region of North-Central Qu?bec. In November 2011, Stornoway released the results of a feasibility study for Renard that highlighted the potential of the project to become a significant producer of high value rough diamonds over a long mine life. NI 43-101 compliant Probable Mineral Reserves stand at 18.0 million carats, with a further 17.5 million carats classified as Inferred Mineral Resources, and 23.5 to 48.5 million carats classified as non-resource exploration upside. All kimberlites remain open at depth. Pre-production capital cost stands at C$802 million, with a life of mine operating cost of C$54.71/tonne giving a 68% operating margin over an initial 11 year mine life. Production start-up is scheduled for 2015. Readers are referred to the technical report dated December 29, 2011 in respect of the Renard Diamond Project for further details and assumptions relating to the project.