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OZ Minerals Redemption of Convertible Bonds

Monday, October 25th, 2010

OZ Minerals advises that notice is being given today to Bondholders of the OZ Minerals Convertible Bonds that OZ Minerals will redeem any Bonds that remain outstanding on or around 24 November, 2010. Under the Terms and Conditions of the Bonds, OZ Minerals has the option to redeem outstanding Bonds as the OZ Minerals share price has exceeded 130% of the Conversion Price for more than 20 out of 30 successive trading days.
The Convertible Bonds have a face value of US$105 million. If Bondholders elect to exercise their Conversion Right prior to the redemption date of 24 November, conversion at the current Conversion Price of US$0.895 will result in 117,318,436 ordinary shares being issued, representing a 3.8% increase in OZ Minerals issued capital.
Conversion Notices have recently been received from five Bondholders in respect of Bonds with a total principal value of US$24.3 million, for which 27,150,838 ordinary shares will be issued today. As the value of OZ Minerals shares is currently greater than the Conversion Price, OZ Minerals expects that remaining Bondholders will exercise their Conversion Rights, rather than receive repayment of the principal value of the Bonds.
By exercising the option to redeem the Bonds, OZ Minerals will avoid future interest expense on the Bonds at 5.25% per annum and future reductions in the Conversion Price as a consequence of any future dividends.
The OZ Minerals Board continues to assess capital management opportunities including possible future debt facilities.

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