Filed by Inco Limited
Pursuant to Rule 425 under the Securities Act of 1933
Subject Company: Falconbridge Limited
Commission File No. 1-11284
Inco Limited Commission File No. 1-1143
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Scott M. Hand
Chairman and
Chief Executive Officer |
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(416) 361-7667 Telephone
(416) 361-7734 Facsimile
Email: shand@inco.com |
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May 14, 2005 |
To fellow Inco employees:
This weekend, our Board of Directors made the decision to increase our friendly acquisition
offer for Falconbridge by Cdn. $5.00 per share.
Why have we increased our offer? Because metal prices have changed dramatically since we first
announced our offer, and as a result Falconbridges operations have delivered more value and
generated more cash, particularly in their copper business. Given this reality, we realized that
for Falconbridge shareholders to tender their shares, we had to improve our offer.
I dont have to tell you that this has been a week of big news for Inco. On Monday May
8th, Teck Cominco announced a hostile takeover bid for Inco. Our Board of Directors is
still waiting to receive Tecks formal offer and we will comment in due course, but I would like to
stress that this offer does not change one bit the way we feel about the combination of Inco and
Falconbridge and we stated that strong position to the public in our press release over the
weekend.
In fact, the Inco team and our Board are more convinced than ever that combining Inco and
Falconbridge is the best deal for Inco and its shareholders. I still believe that this combination
is great for the people of Inco and Falconbridge. This combination is not about getting big for
the sake of getting big. It is about creating a great company and creating real value. This isnt
just the best value-creating alternative for our shareholders its probably the best value
creating acquisition in the mining industry. Its the right deal with the right company!
We continue to work with the U.S. Department of Justice and the European Commission on the
regulatory front and we believe well be able to address competitive concerns with a remedy that
will be acceptable to Inco, Falconbridge and the regulatory agencies. We currently expect that
process to conclude near the end of June or mid-July.
I realize this is a long process longer than wed originally hoped. I also realize that the
announcement from Teck has only added new uncertainties for employees.
I wish I could say we had definite answers to all the questions I know many of you have but
unfortunately, at this stage, we dont. All I can say is that I am working as hard as I can to get
the right result for all of us. I will pledge to you that as events unfold, we will keep you
informed, and as soon as we have answers to your questions, you will hear them.
We will be making every effort we possibly can in the coming weeks to see that the
Falconbridge deal gets done and will keep you abreast of our progress. During that time, as
always, I urge you to keep safety uppermost in everything that you do.
Thank you for your continued support and for your patience.
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Yours truly,
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As many of you are shareholders, we are required to include the following legal legend in all of
our communications concerning the Falconbridge offer.
Forward-Looking Statements
This communication contains forward-looking information about Inco and the combined company after
completion of the purchase by Inco of all outstanding shares of Falconbridge, that are intended to
be covered by the safe harbor for forward-looking statements provided by the Private Securities
Litigation Reform Act of 1995. Forward-looking statements are statements that are not historical
facts. Words such as expect(s), feel(s), believe(s), will, may, anticipate(s) and
similar expressions are intended to identify forward-looking statements. These statements include,
but are not limited to, financial projections and estimates and their underlying assumptions;
statements regarding plans, objectives and expectations with respect to future operations, products
and services and projects; statements regarding business and financial prospects; financial
multiples and accretion estimates; statements regarding anticipated financial or operating
performance and cash flows; statements regarding expected synergies and cost savings, including the
timing, from the proposed combination of the two companies; statements concerning possible
divestitures; and statements regarding strategies, objectives, goals and targets. Such statements
are subject to certain risks and uncertainties, many of which are difficult to predict and are
generally beyond the control of Inco, that could cause actual results to differ materially from
those expressed in, or implied or projected by, the forward-looking information and statements.
The forward-looking statements included in this letter represent Incos views as of the date
hereof. While Inco anticipates that subsequent events and developments may cause Incos views to
change, Inco specifically disclaims any obligation to update these forward-looking statements.
These forward-looking statements should not be relied upon as representing Incos views as of any
date subsequent to the date hereof. Readers are also urged to carefully review and consider the
various disclosures in Incos various SEC filings, including, but not limited to, Incos Annual
Report on Form 10-K for the year ended December 31, 2005 and Incos Quarterly Report on Form 10-Q
for the quarter ended March 31, 2006.
Important Legal Information
This presentation may be deemed to be solicitation material in respect of Incos proposed
combination with Falconbridge. Inco filed with the SEC a registration statement on Form F-8
(containing an offer to purchase and a share exchange take-over bid circular) and amendments
thereto, and will file further amendments thereto as required, in connection with the proposed
combination. Inco has also filed, and will file (if required), other documents with the SEC in
connection with the proposed combination. Falconbridge has filed a Schedule 14D-9F in connection
with Incos offer and has filed, and will file (if required), other documents regarding the
proposed combination, in each case with the SEC.
INVESTORS AND SECURITYHOLDERS ARE URGED TO READ THE REGISTRATION STATEMENT AND ANY OTHER RELEVANT
DOCUMENTS FILED OR THAT WILL BE FILED WITH THE SEC WHEN THEY BECOME AVAILABLE BECAUSE THEY CONTAIN
OR WILL CONTAIN IMPORTANT INFORMATION.
Investors and security holders may obtain copies of the registration statement and Incos and
Falconbridges SEC filings free of charge at the SECs website (www.sec.gov). In addition,
documents filed with the SEC by Inco may be obtained free of charge by contacting Incos media or
investor relations departments. Filings made by Inco with Canadian securities regulatory
authorities, including filings made in connection with the offer, are available at
www.sedar.com.