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IBC Advanced Alloys pulls planned financing

Rare metals alloy maker and distributor IBC Advanced Alloys (CVE:IB) withdrew Monday its recently announced planned short-form prospectus financing, saying that any financing at current indicated pricing would not be in the best interests of the company and its shareholders.

On September 12, the company filed paperwork with the BC securities regulator to raise between $5 and $8 million, with the proceeds to be used to strengthen the company's balance sheet including paying down debt, adding inventory, funding future corporate development initiatives and for general working capital purposes.

IBC said that the decision to cancel the financing was taken by the company and its investment banking advisors, Euro Pacific Canada.

In June, IBC successfully completed a gross $8 million prospectus financing, and said it is fully funded well into 2012.

President and CEO of IBC Advanced Alloys, Anthony Dutton, said: "The primary use of proceeds of the offering was to pay down existing debt and strengthen IBC's balance sheet.

"However, IBC's management, board and advisors concluded that recent irregular trading activity and the resulting drop in share price does not represent a fair and reasonable value for the company."

"We have consistently demonstrated that we have a strong and growing company with enormous potential. Any financings the company may entertain will only be done in this context and in the best interests of the company and its shareholders."

Vancouver-based IBC, with facilities in Indiana, Massachusetts, Pennsylvania and Missouri, manufactures and distributes rare metals-based alloys for a wide range of industries including nuclear energy, automotive, telecommunications and a number of other industrial applications.

The company also owns prospective beryllium properties in the Western US covering approximately 9,500 hectares.

Earlier this year, IBC unveiled encouraging results from the first phase of a research and development project on nuclear fuels.

The company, together with Purdue Univeristy and Texas Engineering Experiment Station, part of Texas A&M University, have been engaged in a mission to develop a nuclear fuel enhanced with beryllium oxide, a rare metal, for commercial use in nuclear power reactors. The benefit of the enhanced fuel, according to IBC, is that it features a cooler temperature than conventional fuels, meaning the new fuel can be operated at a lower temperature without sacrificing power output. This results in both safety and environmental benefits, as less uranium is required to produce the same amount of power.

This could lead to decreased fuel operating costs, through increased efficiency, as well as reduced fuel consumption.

IBC's president of nuclear fuels, Jim Malone, was recently appointed as chairman of the World Nuclear Association's Fuel Technology Working Group to explore alternative fuel types for the nuclear industry. Malone has over 40 years of senior experience in the nuclear industry and is currently chairman of the board of uranium company Hathor Exploration (TSE:HAT), which recently receved a $520 million takeover offer from uranium giant Cameco (TSE:CCO).

Monday morning, IBC shares were up 6% at 17.5 cents.