Talvivaara Mining Company Plc. to apply for corporate reorganisation

Stock Exchange Release
Talvivaara Mining Company Plc
15 November 2013



Talvivaara Mining Company Plc to apply for corporate reorganisation


On 10 October 2013, Talvivaara Mining Company Plc ("Talvivaara") announced that,
as the market price of nickel had declined by more than 20 per cent. since the
first quarter of 2013 and as Talvivaara's production had continued to be
impacted by the prolonged effects of excess water on older ore heaps,
Talvivaara's liquidity position had weakened more than anticipated. In addition,
on 7 November 2013, Talvivaara announced in its interim report for the nine
months ended 30 September 2013 that it was in advanced discussions with certain
stakeholders concerning a financing solution that would address Talvivaara's
current liquidity needs. These discussions have continued intensely since that
time.

It has become evident as a result of such discussions that additional liquidity
would not be available for Talvivaara as part of a voluntary restructuring.
Therefore, Talvivaara and its operating subsidiary Talvivaara Sotkamo Ltd
(together, the Talvivaara Group") have concluded that each company should file
for a corporate reorganisation. In order for Talvivaara and Talvivaara Sotkamo
Ltd to qualify for a corporate reorganisation, the Talvivaara Group will require
additional liquidity during the reorganisation proceedings for the payment of
costs of the reorganisation proceedings and payment of new indebtedness incurred
after the filing for reorganisation. Availability of additional funding would
facilitate an orderly reorganisation process in a court-supervised environment
with the objective of attracting long-term capital and right-sizing the capital
structure of Talvivaara.

Towards this goal, Talvivaara yesterday made a financing proposal to a group of
stakeholders for additional funding in the form of a €40 million restructuring
facility with Talvivaara as the guarantor and Talvivaara Sotkamo Ltd as the
borrower. However, such stakeholders informed Talvivaara late yesterday that,
due to timing and other constraints, they were currently not in a position to
make any decisions in respect of funding commitments to Talvivaara or Talvivaara
Sotkamo Ltd. Talvivaara was also separately informed that a final decision with
regard to such restructuring facility by certain stakeholders would not be
available, unless and until Talvivaara and Talvivaara Sotkamo Ltd had filed for
a corporate reorganisation. Although there can be no assurance that such
additional financing will be obtained, Talvivaara will seek to work with the
relevant stakeholders towards a definitive agreement in an expeditious manner.
Availability of any funding under the restructuring facility would be expected
to be subject to certain conditions and milestones, which would be agreed as
part of the final documentation regarding the restructuring facility.

In part in reliance on the possible availability of the restructuring facility
and confirmation by the Talvivaara Group's major secured creditors of their
support to a corporate reorganisation, the Board of Directors of Talvivaara has
decided to apply for corporate reorganisation of Talvivaara pursuant to the
Finnish Corporate Reorganization Act. In addition, shareholders of Talvivaara
Sotkamo Ltd have unanimously decided to apply for corporate reorganisation of
Talvivaara Sotkamo Ltd. Talvivaara expects that said applications will be filed
with the district court of Espoo, Finland, during 15 November, 2013. The Board
of Directors of Talvivaara will convene an Extraordinary General Meeting of
shareholders to address the corporate reorganisation application of Talvivaara
at a later time to be announced separately.

The Board of Directors of Talvivaara believes that bankruptcy proceedings of
either company would have a material value destructing effect and, therefore,
would not be in the best interests of Talvivaara and its stakeholders.
Bankruptcy proceedings would endanger the employment of the employees of the
Talvivaara Group and of many of its suppliers and contractors. Also, the
environmental impact of a bankruptcy would be difficult to manage. Talvivaara
believes that, under the circumstances, corporate reorganisation proceedings and
continued production at the Sotkamo site will best facilitate water treatment
and other environmental clean-up and will also provide the best possibility to
preserve value for various stakeholders.

Although the Board of Directors believes that, subject to the availability of
sufficient funding, a corporate reorganisation is a viable option for
Talvivaara, there can be no assurance that Talvivaara will obtain the required
funding through the restructuring facility or otherwise or that Talvivaara's
corporate reorganisation, if commenced, is ultimately successful. The corporate
reorganisation process can fail for a number of reasons, including due to an
insufficiency of funds to complete the reorganisation proceedings, unforeseen
operational or environmental issues facing Talvivaara's production facilities,
changes in the operating environment affecting the financial viability of
Talvivaara and various other factors. If the corporate reorganisation fails for
these or any other reasons, Talvivaara would expect to file for bankruptcy
proceedings unless other alternatives have materialised by that time.

Talvivaara will arrange a press conference on 15 November 2013 at 11.00 am
(Finnish time) in Scandic Simonkenttä at Simonkatu 9, Helsinki, Finland.

Enquiries
Talvivaara Mining Company Plc Tel +358 20 7129 800
Pekka Perä, CEO
Saila Miettinen-Lähde, Deputy CEO and CFO



Talvivaara Mining Company Plc
Talvivaara Mining Company is an internationally significant base metals producer
with its primary focus on nickel and zinc using a technology known as
bioheapleaching to extract metals out of ore. Bioheapleaching makes extraction
of metals from low grade ore economically viable. The Talvivaara deposits
comprise one of the largest known sulphide nickel resources in Europe. The ore
body is estimated to support anticipated production for several decades.
Talvivaara has secured a 10-year off-take agreement for 100 per cent of its main
output of nickel and cobalt to Norilsk Nickel and entered into a long-term zinc
streaming agreement with Nyrstar NV. Talvivaara is listed on the London Stock
Exchange Main Market and NASDAQ OMX Helsinki. Further information can be found
at www.talvivaara.com.

Talvivaara to apply for corporate reorganisation 15.11.2013:
http://hugin.info/136227/R/1743482/586496.pdf



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Source: Talvivaaran Kaivososakeyhtiö Oyj via Thomson Reuters ONE
[HUG#1743482]