Minefinders to increase conversion rate of 4.5% notes, hold change-of-control tender offer

By Angela McDaniels

Tacoma, Wash., Feb. 29 - Minefinders Corp. Ltd. announced an increase to the conversion rate of its 4.5% convertible senior convertibles due 2015 and plans for a change-of-control tender offer.

On Jan. 22, Pan American Silver Corp. agreed to acquire all of the common shares of Minefinders for a combination of cash and stock. The acquisition is expected to close March 30, according to a Minefinders news release.

For each share held, Minefinders shareholders will receive (a) 0.55 shares of Pan American and C$1.84 in cash, (b) 0.6235 shares of Pan American and C$0.0001 in cash or (c) C$15.60 in cash, subject to proration under total cash and share pools.

Noteholders who convert prior to or after closing will receive additional common shares because the acquisition is considered to be a fundamental change.

Within 30 days of closing, Minefinders must offer to purchase the notes at par plus accrued interest and certain additional amounts.

Notes that are not converted or tendered will remain outstanding and will continue to be convertible after the acquisition closes.

The acquisition remains subject to conditions that include the approval of Minefinders' shareholders. A special meeting of shareholders is scheduled for March 26.

Minefinders is a precious metals mining and exploration company. Pan American Silver is a silver miner. Both are based in Vancouver, B.C.

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