Murray & Co arranges US$30m funding for Pike River

MEDIA RELEASE

17th January 2008

Murray & Company arranges US$30m funding for Pike River

NZX and ASX listed Pike River Coal Limited has raised US$30 million to complete the financing required for the development of its premium hard coking coal deposit on the West Coast. This financing is in addition to the NZ$60 million equity rights issue announced by Pike River yesterday.

The US$30m was raised in the form of convertible bonds. Christchurch-based boutique investment bank Murray & Company was Lead Manager and Arranger of the convertible issue. Murray & Company placed the bonds with a Singapore-based investment fund.
Pike River Coal is in the process of developing its premium hard coking coal deposit – a 58.5 million tonnes inground resource located in the Paparoa mountain range 50km north-east of Greymouth.

The company expects to achieve first coal by July 2008 with annual saleable production of premium hard coking coal expected to reach one million tonnes per annum by mid 2009. The coal will be transported by rail, exported from Lyttelton and used in the production of steel. By the time Pike reaches full production it will be the second largest coal export mine in New Zealand.

Pike’s use of senior convertible financing as a substitute for bank debt is considered innovative. Managing Director of Murray & Company, Justin Murray said that the funding provides Pike River with a flexible financing facility, which is well suited to Pike’s requirements and reflects Pike’s appeal to international investors.

“This transaction also demonstrates Murray & Company’s ability to access top-tier offshore institutional investors to finance companies and projects in New Zealand.”

The convertible bond issue is conditional upon Pike River shareholder approval at a meeting set for 4th February 2008 and completion of the rights issue.

In sourcing financing and investment from offshore, Murray & Company works closely with its Advisory Board, with five of its six Advisory Board members based in offshore locations, including Australia, UK and Singapore. One such member, Ravi Chidambaram, founder and President of Singapore-based investment bank TC Capital, was closely involved in the Pike financing.

“Our firm benefits greatly from the involvement of an exceptional Advisory Board comprising international experts in governance, investment banking and asset management”. The only New Zealander on the Advisory Board is Wayne Boyd, Chairman of Telecom NZ.

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About Murray & Company:

Murray & Company is a boutique investment bank based in Christchurch. With an international network, the firm is active throughout AsiaPac with a focus on New Zealand and Australia. Justin Murray (Managing Director) founded the firm in 2004, with Humphry Rolleston as Chairman. The firm acts as financial advisor and arranger for companies, institutions and wealthy individuals. Its areas of focus include: debt and equity capital raising, sale of business and corporate assets, mergers and acquisitions, project finance and principal investment.

The firm is characterised by a quality senior team whose mix of local talent (four of the six investment bankers are originally from Christchurch) with their considerable overseas careers makes for a unique and formidable combination in the South Island and beyond.

First NZ Capital owns 25% of Murray & Company. The balance of Murray & Company is owned by its principals.

About Murray & Company’s Advisory Board:

The Advisory Board provides independent guidance and oversight to the Directors and management of Murray & Company. It comprises:

Wayne Boyd, one of New Zealand’s most experienced public company directors with a background in law and merchant banking in New Zealand and the UK. Chairman of Telecom NZ.

Mark Barnaba, co-founder and Executive Chairman of leading Western Australian merchant bank, Azure Capital.

Ravi Chidambaram, co-founder and President of successful Singapore-based investment bank, TC Capital.

Hilton Nathanson, founder and Managing Partner of Marble Bar Asset Management, a London-based multi-strategy hedge fund managing over $US4 billion for its clients.

Thomas Reilley, London-based private investor and previously Senior Managing Director at Bear, Stearns, where he headed the European and Middle East Private Client Group.

Hans Van Hoof, Jersey-based private investor who previously held senior positions within European financial institutions for almost 20 years, including serving as Chairman and CEO of Soros Funds.

ENDS

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