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Mercator Minerals Expands Copper Operations through Stingray Copper Acquisition

|Includes: Mercator Minerals (MRCMF)

Mercator Minerals Ltd (TSX: ML) announced the agreed acquisition of Stingray Copper (TSX: SRY) by way of a 1:4 stock offer. The deal represents a 51.6% premium on Stingray’s closing share price on the 1st of October. The respective boards have agreed the terms of the merger, which will provide Mercator with a substantial increase to its potential copper footprint.

The Transaction is expected to close before the end of the year at which point Stingray shareholders will hold approximately 8% of the combined company. Michael Surratt, current President and CEO of Mercator will remain CEO of the combined company and Peter Mordaunt, current CEO and Chairman of Stingray will become President and COO of the combined company.

The apparent mutual benefit of the proposed acquisition sees Mercator gain the low cost and near term El Pilar project the cathode copper producing asset with manageable CAPEX increases Mercator's leverage to copper.

Adding annual copper production of approximately 70m pounds per year starting in 2 Stingray’s properties provide a 112% increase in copper reserves, 1.5 billion lbs with acquired at less than US$0.02/lb.

Specifically the El Pilar project in northern Mexico fills project development gap with the completion of Mercator’s Nevada based ‘Mineral Park Phase II’ expansion coinciding with the start of construction in Mexico.

Mercator Minerals Ltd has brought the mill expansion at the Mineral Park Mine, one of the largest and most modern copper-moly mining-milling operations in North America to production in less than 2 years. Stingray Copper Inc. is focused on the El Pilar copper project located in the Cananea copper trend of Sonora, Mexico.

In April, a feasibility study at the ‘El Pilar’ project indicated positive economics for development as a low cost, open pit mine with a solvent extraction and electro-winning plant to treat the 230 million tonne oxide mineral reserve.
Mercator CEO, Michael Surratt commented on the deal which provides Mercator with their next development opportunity;

 "This transaction will substantially increase Mercator's leverage to copper and represents a robust development opportunity for shareholders, subsequent to the completion of the Mineral Park Phase II expansion at the end of 2010".