Noranda Income Fund Formed to Purchase CEZinc

On April 18, 2002, the Noranda Income Fund was formed to indirectly purchase the CEZinc Processing Facility from Noranda Inc. on May 3, 2002 for $675 million, which was ultimately paid by the issuance of 37.5 million priority units of the fund (valued at $10 a unit), 12.5 million ordinary units of Noranda Income Limited Partnership (which have equivalent voting rights as priority units, but are subordinate to the priority units with respect to the payment of a base distribution and, which are exchangeable for priority units on a one-for-one basis only after 15 years except in certain limited circumstances), and the payment of $175 million in cash. On May 3, 2002, a $225 million initial public offering (by way of a secondary offering by Noranda), of priority units of the fund was completed. Noranda subsequently sold an additional 3,015,100 priority units pursuant to the exercise of an over-allotment option granted by Noranda to the underwriters.

CIBC World Markets Inc. and Scotia Capital Inc. co-led the syndicate of underwriters that included RBC Dominion Securities Inc., TD Securities Inc., BMO Nesbitt Burns Inc., National Bank Financial Inc. and Trilon Securities Corporation. To assist in paying the purchase price and for working capital purposes, a subsidiary of the fund established a $205 million line of credit with a syndicate of banks led by Canadian Imperial Bank of Commerce and The Bank of Nova Scotia, and included Royal Bank of Canada, The Toronto-Dominion Bank, Bank of Montreal and National Bank of Canada. After the completion of the transactions, Noranda retained a 49 per cent voting and equity interest (including the ordinary units), in the fund.
McCarthy Tétrault LLP represented Noranda and the fund, with a team that included Christopher Hoffmann, Ian Arellano, Richard Miner, Frank DeLuca, Stephanie Haladner, Eva Sommer-Ng and Kenneth Landa (corporate/securities), Robert Stephenson, Linda Pieterson and Wendi Locke (banking) and Gabrielle Richards and Jim Morand (tax) in Toronto, Louis Martin Dubé and Michael Levinson (real property), Anne Marie Sheahan and Marie-Claude Caron (environmental), Marc Benoit (employment/labour), Marie Mandeville and Elisabeth Patterson (intellectual property) and Martin-Pierre Boulianne (corporate) in Montreal, and Donna Cooke, George Holloway, Brian Vick, Sally Dennis and Mary Childs (corporate) in Vancouver.

Torys LLP acted as counsel to the underwriters, with a team that included James Scarlett, Karrin Powys-Lybbe, Sarah Lerchs and Cornell Wright (corporate/securities), Dennis Mahoney and Mark Adkins (environmental) and Corrado Cardarelli and Ann Marie McGovern (tax).

Borden Ladner Gervais LLP acted for bank syndicate, with a team that included Frank Callaghan, Stephen Redican, Howard Silverman, Colin Simpson and Jeff Ellis (banking) and Rick Coburn (environmental) in Toronto, Sylvie Bouvette (real property), Betsy Mitchell (banking) and Christine Duchaine (environmental) in Montreal, and Ken Andersen (banking) in Vancouver.


Jeffrey Ellis