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Abstract
(CCNMatthews - June 3, 2005) - Noranda Inc. ("Noranda") (TSX:NRD.LV)(NYSE:NRD) and Falconbridge Limited ("Falconbridge") (TSX:FL) today announced that they have agreed to amalgamate and continue as one corporation to be named "Falconbridge Limited". Under the proposed amalgamation, each outstanding Falconbridge common share (other than shares held by Noranda) will be converted into 1.77 common shares of the new Falconbridge Limited and each outstanding Noranda common share will be converted into one common share of the new Falconbridge Limited. Each Noranda preferred share or junior preference share and Falconbridge preferred share will be converted into an equal number of preferred shares or junior preference shares of the new Falconbridge Limited having the same attributes as the shares held by them immediately prior to the amalgamation. The combination will create one of North America's largest base metals companies with combined assets of approximately US$12 billion at December 31, 2004 and combined revenues of approximately US$7 billion in 2004. Noranda and Falconbridge believe that this transaction also results in: - a widely-held company with increased shareholder liquidity; - a simplified corporate structure; - increased scale, reducing concentration risk of any one project or operation; - substantial leverage to strong market fundamentals for base metals; - enhanced financial flexibility and improved access to credit; and, - greater financial and operational strength with the ability to compete globally in the copper and nickel businesses. "We look forward to completing the amalgamation of the two companies," said Derek Pannell, President and Chief Executive Officer of Noranda. "The combined company will remain focused on growing its nickel and copper businesses, two metals with excellent long-term market fundamentals." "With an attractive pipeline of projects, expanded operations and a simplified corporate structure, we believe that the combined company will be well positioned to benefit from current market conditions and the positive long-term outlook for the metals business," said Aaron Regent, President and Chief Executive Officer of Falconbridge. Upon completion of the amalgamation, Derek Pannell will become Chief Executive Officer of the new Falconbridge and Aaron Regent will become President.