South Atlantic Ventures Acquires North Mining Svenska

On June 2, 2004, Vancouver-based South Atlantic Ventures Ltd. completed the acquisition of North Mining Svenska AB from the Rio Tinto group of companies. North Mining Svenska is the owner and operator of the Zinkgruvan mine, the largest underground mining facility in Europe. The shares of North Mining were acquired for an aggregate of US$101 million, plus a cash payment of approximately US$5,355,000 for working capital and a maximum of US$5 million in future price participation payments.

To finance the acquisition, South Atlantic completed a $160 million short form prospectus offering, selling 20 million common shares at $8 per share. This financing, which was offered by GMP Securities Ltd., BMO Nesbitt Burns Inc., Haywood Securities Inc., Macquarie North America Ltd. and in Sweden by E. Öhman J:or Fondkommission AB, is the largest financing ever to have completed on the TSX Venture Exchange. Macquarie also acted as financial advisors to South Atlantic in respect of the transaction.

South Atlantic was represented by McCullough O’Connor Irwin with a team that included Kevin Hisko, Jonathan McCullough, Victoria Steeves and Kristen Novak; by Cassels Brock & Blackwell, with a team that included John Craig, John Vettese and Chad Accursi; and by Erik Nerpin and Marcus Hedén of Linklaters in Sweden. Doug Powrie of Thorsteinssons provided advice on tax matters.

In the share acquisition, the Rio Tinto group was represented in-house by Marcus Dowding, in-house legal counsel at Rio Tinto plc. In the financing, the agents were represented by Steve Vaughan, Michael Burns and Sarah Diamond of McMillan Binch.