Premium All-Cash Offer to Acquire BAFFINLAND IRON MINES CORPORATION Announced by Nunavut Iron Ore Acquisition Inc.

Last Update: 9/22/2010 7:30:00 AM

TORONTO, Sep. 22, 2010 (Canada NewsWire via COMTEX) -- Highlights of the Offer:

    
    
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Fully-funded all-cash offer of $0.80 per Common Share;
    
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Premium of approximately 100% over volume-weighted average price per
        
Common Share on the TSX over the 20 trading days ended August 26,
        
2010;
    
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Immediate liquidity and elimination of risk for shareholders;
    
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Approximately 15.3% of Common Shares (14.3% fully-diluted) now are
        
owned by Nunavut Iron Ore and its affiliates or are subject to
        
agreements to tender to the Offer.
    

TORONTO, Sept. 22 /CNW/ - Nunavut Iron Ore Acquisition Inc. ("Nunavut Iron Ore"), a corporation wholly-owned by Iron Ore Holdings, LP, today announced that it has commenced an offer (the "Offer") to purchase all of the Common Shares of Baffinland Iron Mines Corporation ("Baffinland") (TSX - BIM).

The Offer has been commenced by publication of an advertisement and filing of a take-over bid circular which includes the full details of the Offer, including the terms and conditions of the Offer. The Offer will be open for acceptance until 5:00 p.m. (Toronto time) on October 28, 2010 (the "Expiry Time"), unless the Offer is extended or withdrawn.

A COMPELLING OFFER FOR BAFFINLAND SHAREHOLDERS

Shareholders should consider the following benefits in making their decision to tender their shares to the Offer:

    
    
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Attractive Premium. The Offer price of $0.80 per Common Share
        
represents a premium of approximately 100% over the volume-weighted
        
average price of $0.40 per Common Share over the 20 trading days on
        
the TSX ending August 26, 2010. Nunavut Iron Ore believes that August
        
26, 2010 is the most relevant date from which to measure the premium
        
represented by the Offer since it was the last trading day prior to
        
commencement of the purchases of the Common Shares currently held by
        
Nunavut Iron Ore and its affiliates.
        
The Offer also represents a premium of approximately 42.9% over the
        
closing price of $0.56 per Common Share on the TSX on September 21,
        
2010, and a premium of 36.6% over the volume-weighted average price
        
of approximately $0.58 per Common Share over the 20 trading days on
        
the TSX ending on September 21, 2010.
    
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Liquidity and Certainty of Value. The consideration under the Offer
        
is cash, which provides shareholders with certainty of value and
        
immediate liquidity and removes the execution risk to shareholders
        
associated with Baffinland's business initiatives and long-term
        
business plan.
    
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Fully Financed Cash Offer. The Offer has no unusual conditions for an
        
offer of this kind and is not subject to obtaining any financing.
    
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Avoidance of further dilution. Continued development of the Mary
        
River Property will require substantial additional funds and any
        
equity financing, joint venture or other transaction undertaken could
        
result in material dilution to the then-existing shareholders of
        
Baffinland.
    

"Through our offer, Baffinland shareholders have an opportunity to receive an immediate and substantial all-cash premium for their investment and eliminate the inherent risks in a company at Baffinland's stage of development," said Bruce Walter, Chairman of Nunavut Iron Ore.

Mr. Walter also assured other key stakeholders in the Mary River Property, such as the Qikiqtani Inuit Association and employees of Baffinland, that, with the successful acquisition of Baffinland, Nunavut Iron Ore intends to work to expedite development of the Mary River Property for the benefit of all stakeholders.

HOLDINGS OF NUNAVUT IRON ORE AND LOCK-UP AGREEMENTS

Approximately 15.3% of the outstanding Common Shares (14.3% on a fully-diluted basis) are now owned by Nunavut Iron Ore and its affiliates or are subject to agreements to tender to the Offer.

Nunavut Iron Ore, together with its affiliates, currently owns 20,390,500 Common Shares, representing approximately 6.0% of the outstanding Common Shares, and 5,000,000 warrants, together representing approximately 6.3% of the outstanding Common Shares on a fully-diluted basis. A total of 32,057,500 Common Shares or approximately 9.3% of the Common Shares outstanding (approximately 8.0% on a fully-diluted basis) are subject to agreements to tender to the Offer entered into with certain shareholders of Baffinland.

TENDERING TO THE OFFER

Shareholders who wish to accept the Offer must properly complete and execute the Letter of Transmittal and deposit it at or prior to the Expiry Time, together with certificate(s) representing their Common Shares and all other required documents, with the Depositary, Kingsdale Shareholder Services Inc., at its office in Toronto, Ontario in accordance with the instructions in the Letter of Transmittal.

Questions and requests for assistance may be directed to the Depositary and Information Agent for the Offer, Kingsdale Shareholder Services Inc., at 1-888-518-1562 toll free in North America, or at 416-867-2272 outside of North America, or by email at contactus@kingsdaleshareholder.com.

Shareholders whose Common Shares are registered in the name of an investment advisor, stockbroker, bank, trust company or other nominee should immediately contact that nominee for assistance if they wish to accept the Offer in order to take the necessary steps to be able to deposit such Common Shares under the Offer.

ABOUT NUNAVUT IRON ORE AND IRON ORE HOLDINGS, LP

Nunavut Iron Ore was incorporated under the laws of Canada on August 27, 2010 and has not carried on any material business other than in connection with matters directly related to the Offer. Nunavut Iron Ore is wholly owned by Iron Ore Holdings, LP.

Iron Ore Holdings is a limited partnership formed under the laws of Delaware for the purpose of making the Offer. Iron Ore Holdings is owned by Bruce Walter, the Chairman of Nunavut Iron Ore, Jowdat Waheed, the President and Chief Executive Officer of Nunavut Iron Ore, and funds (the "EMG Funds") managed by The Energy & Minerals Group, which is providing the majority of the equity financing for the Offer. The Energy & Minerals Group is a private investment firm with a family of funds with over US$2 billion under management that invest in the energy and minerals sectors.