Talvivaara's draft restructuring programmes submitted to the District Court of Espoo

Stock Exchange Release
Talvivaara Mining Company Plc
30 September 2014

Talvivaara's draft restructuring programmes submitted to the District Court of
Espoo

The Administrator of the corporate reorganisation of Talvivaara Mining Company Plc ("Talvivaara" or "Company") and its operating subsidiary Talvivaara Sotkamo
Ltd ("Talvivaara Sotkamo") has today filed the draft restructuring programmes of
both companies to the District Court of Espoo.

According to the Administrator, the business operations of both Talvivaara and
Talvivaara Sotkamo have proven to be viable during the corporate reorganisation
proceedings, and it is possible to make the mining operations in Sotkamo
profitable. However, the continuation of the business operations will require
that new financing be obtained.

The essential content of the draft restructuring programmes is as follows:

* The starting point for the Administrator's draft restructuring programme is
the sale of all of Talvivaara Sotkamo's business operations through a so
called realisation restructuring process to a new company established by
Talvivaara ("NewCo"). In the same connection, the existing product streaming
and product sale and purchase agreements in Talvivaara Sotkamo's name would
be transferred on terms to be separately negotiated NewCo. The purchase
price received by Talvivaara Sotkamo would be used in full to pay Talvivaara
Sotkamo's restructuring debts.

* The Administrator's current understanding is that the realisation
restructuring process described herein may, if implemented, also lead to
some degree of dilution of the holdings of Talvivaara's current
shareholders. As a share issuance can be used in addition to a bond
issuance, the dilution of existing shareholdings will to a material extent
depend on the amount with which the existing shareholders are willing to
participate in such arrangement.

* Under the draft restructuring programme of Talvivaara Sotkamo, a one-off
payment would be made to the creditors with the possibility to make
supplementary payments, while a customary eight-year restructuring programme
can in the view of the administrator be drafted for Talvivaara, provided
that financing for the duration of the implementation of the restructuring
programme can be secured. No payments will be made to creditors of
Talvivaara during the first two years. Thus, the payments to creditors will
take place during 2017-2022 so that the creditors will be paid 10% of the
capital cut in accordance with the programme during each of the first two
years (2017-2018) and 20% thereafter (2019-2022). The secured debts and
leasing debts of Talvivaara would be paid off according to the same schedule
as the unsecured debts.

* Talvivaara's cash flow during the programme will consist of fees for
providing administrative, financing and other group services, rental income,
repayment of the amount borrowed to Talvivaara Sotkamo during the
reorganisation proceedings and the repayments on Talvivaara Sotkamo's long-
term loans through the realisation restructuring process.

* The draft restructuring programmes filed to the District Court do not
provide for more specific details on the structure of, parties to and the
other terms and conditions of the potential asset deal and the realization
restructuring process. The Administrator proposes that Talvivaara Sotkamo
shall sign the agreement implementing or facilitating the realisation
restructuring process by 1 December 2014, absent which the Administrator can
petition the District Court to interrupt the restructuring proceedings,
unless the Administrator has special grounds to grant an extension to this
deadline and provided that the District Court has granted a corresponding
extension for submission of the creditors' statements.

* The draft restructuring programmes will be supplemented once the method,
terms and conditions of the transfer of business operations are known. The
supplemented restructuring programmes will be filed to the Espoo District
Court in such a way that the creditors have sufficient time to review it and
give their statement on the draft.

* The Administrator estimates that the part of all the secured restructuring
debt of Talvivaara Sotkamo (in aggregate EUR 130 million) that constitutes
financing debt is EUR 53 million after the deduction of liquidation costs.
The Administrator proposes that EUR 21.9 million of these secured debts will
be payable upon execution of the realisation restructuring process. The
secured creditors and the parties to the sale and purchase of Talvivaara
Sotkamo's business must agree separately on how the remaining balance of the
secured financing debt (EUR 31.1 million) is to be paid. This arrangement
will require the consent of all of the secured creditors.

* The Administrator estimates that the amount of debt secured by a floating
charge of Talvivaara is EUR 7.5 million and the amount of debt secured by
other securities is EUR 3 million after the deduction of liquidation costs.

* The Administrator proposes that the capital of unsecured debts of Talvivaara
Sotkamo (in aggregate not less than EUR 956 million) and Talvivaara (in
aggregate EUR 478 million) be cut by 99% for Talvivaara Sotkamo and by 97%
for Talvivaara. No payments will be made on debts with lowest priority of
either of the companies.The convertible bonds and bonds issued by the
Company shall be treated as unsecured debt.

* Talvivaara would be entitled to a payment of its EUR 527.8 million unsecured
receivable (after set-offs) from Talvivaara Sotkamo in accordance with
Talvivaara Sotkamo's restructuring programme. Talvivaara has pledged EUR
300 million of this receivable as security for its own and its subsidiary's
debts. Payments of the receivable exceeding the pledge will remain for the
benefit of Talvivaara and strengthen the Company's cash reserves.

* The holders of unsecured debt of Talvivaara Sotkamo will be entitled to
receive supplementary payments upon NewCo having to pay additional purchase
price to Talvivaara Sotkamo or upon Talvivaara Sotkamo being entitled to
supplementary payments on the basis of any other undertaking. Under such
circumstances Talvivaara's creditors may be entitled to supplementary
payments. The duty to make supplementary payments will remain valid for
eight years.


The summaries of the draft restructuring programmes are annexed to this release,
and links to the complete texts of the programmes can be found at
www.talvivaara.com.

Enquiries
Talvivaara Mining Company Plc Tel +358 20 7129 800
Pekka Perä, CEO
Saila Miettinen-Lähde, Deputy CEO and CFO
Pekka Jaatinen, Attorney-at-Law Tel +358 20 7765 765
Castrén & Snellman Attorneys Ltd

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 NASDAQ OMX
Helsinki. Further information can be found at www.talvivaara.com.

Talvivaara Mining Co Draft Restructuring Programme SUMMARY:
http://hugin.info/136227/R/1859534/651620.pdf

Talvivaara Sotkamo Draft Restructuring Programme SUMMARY:
http://hugin.info/136227/R/1859534/651621.pdf



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Source: Talvivaaran Kaivososakeyhtiö Oyj via GlobeNewswire
[HUG#1859534]