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
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
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.
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.