PROPOSED MERGER WITH WINCA
CLOSURE OF AURORA FACILITY
Amsterdam, 18 February 2009 --- AMG Advanced Metallurgical Group N.V.'s ("AMG," EURONEXT AMSTERDAM: "AMG") 50.7% owned subsidiary, Timminco Limited ("Timminco"; TSX: TIM), consistent with its strategy of positioning its magnesium business for profitability and strategic divestiture, has entered into a non-binding letter of intent with Winca Tech Limited ("Winca"), a leading Chinese-based producer of magnesium products, to merge the principal components of Timminco's magnesium and specialty metals business, including its manufacturing facility in Nuevo Laredo, Mexico, with all of Winca's magnesium operations. Timminco expects to retain a minority equity interest in the combined business, which will be known as Applied Magnesium International ("AMI"). The head office of AMI is expected to be in Denver, Colorado. The proposed merger is subject to a number of conditions, including financing and the negotiation and execution of definitive agreements, and is expected to be completed in the second quarter of 2009.

Timminco will immediately start winding down production operations at its existing magnesium extrusion facility in Aurora, Colorado, and close this facility later this year. This facility currently employs 52 people. Some of the existing staff and management are expected to be transferred to AMI, along with certain assets and technology.

"The merger of Timminco's and Winca's magnesium operations will allow the two companies to leverage Timminco's pure magnesium and extrusion technology, quality, service and market presence in extruded products with Winca's low cost production base, recently modernized manufacturing facilities and strong market position in magnesium cathodic protection," said John Fenger, President - Light Metals of Timminco. "The closure of our magnesium extrusion operations in Aurora, Colorado, although difficult, is consistent with the divestiture strategy of our magnesium business."

"Incorporating Timminco's magnesium production and extrusion technology into our recently upgraded Chinese operations will allow us to further extend our technical and quality leadership with minimal capital, making us one of the lowest cost producers in the world,", said Dr. He Xu, Chairman of Winca. "It will certainly differentiate Applied Magnesium International from our competition and, most importantly, allow us to provide excellent products and services to our customers for many years to come." Established in 1996, Winca specializes in the production and sales of magnesium alloy sacrificial anodes for electro-chemical corrosion control, high purity magnesium, magnesium alloys, and magnesium extrusions. The Winca College of Magnesium, located in Hebi, Henan province of China, was co-established by Winca, the Hebi Institute of Technology and the China Magnesium Association.

The closure of the Aurora magnesium extrusion operations will result in severance payments and other cash closure costs of approximately $3 million, which will be incurred in 2009. Timminco expects to record charges in the first half of 2009 relating to these costs. The majority of the production assets of the Aurora facility were deemed to be impaired during 2006 and written down to fair market value at that time. To the extent that estimated proceeds of disposition, if any, are less than the carrying value of such assets, a charge will be taken in the first half of 2009. Timminco currently expects to recover a significant portion of its investment in working capital as the business is transitioned to AMI. Timminco expects to generate net cash proceeds from these announced plans during 2009.