Dr. Heinz Schimmelbusch reports

TIMMINCO TO FORM JOINT VENTURE WITH DOW CORNING AT BECANCOUR SILICON METAL FACILITIES

Timminco Ltd. has agreed to form a joint venture with Dow Corning Corp. at its silicon metal production facilities in Becancour, Que. Dow Corning will acquire a 49-per-cent equity interest in a new joint venture entity that will own the existing silicon metal operations of Timminco's wholly owned subsidiary, Becancour Silicon Inc. (BSI). In exchange, BSI will receive net cash proceeds of $39.7-million (U.S.) on closing, and up to potentially an additional $10.0-million (U.S.) after closing subject to achieving certain performance objectives relating to production cost and capacity improvements. BSI will retain a 51-per-cent equity stake in the joint venture.

All of the production output of the joint venture, which will be based on an initial annual production capacity of 47,000 metric tonnes of silicon metal, will be split between BSI and Dow Corning proportional to their ownership interests. All of BSI's solar grade silicon purification operations and facilities at the Becancour site will remain with BSI.

"This joint venture with Dow Corning builds on a long and successful relationship between the two companies and strengthens Timminco's position for future growth opportunities," said Dr. Heinz C. Schimmelbusch, Timminco's chairman of the board and chief executive officer.

"This acquisition is well aligned with Dow Corning's global strategy of securing an efficient supply of this critical raw material used to manufacture all of our silicon-based products," said Robert Hansen, Dow Corning's executive vice-president and general manager of core products.

The joint venture, which will be known as "Quebec Silicon," will acquire from BSI all of the silicon metal production assets, including property, plant, equipment and certain net working capital items, and BSI's quartz mining lease in Lac Malbaie, Que. BSI will retain its silicon metal customer relationships, and honour all existing contracts with such customers, through BSI's proportional offtake of the joint venture's production.

All active employees associated with the silicon metal operations will be transferred to the joint venture, which will assume certain liabilities associated with such employees, including pension obligations. The transferring employees include a majority of BSI's existing management team, which will continue to manage and operate the silicon metal operations.

The creation of the joint venture and the closing of Dow Corning's acquisition of its 49-per-cent equity interest is expected to occur on or about Sept. 30, 2010. The closing is subject to satisfaction of customary closing conditions, including regulatory approvals and consent of BSI's lenders. In the event the conditions are not fulfilled and the transactions do not proceed, BSI and Dow Corning have committed to alternative supply arrangements for 20,000 metric tons of silicon metal to be delivered in 2011.