TORONTO, May 24, 2011 /CNW/ - Polo Resources Limited (AIM and TSX: POL)
is pleased to announce that it has completed an investment of
approximately US$4 million in the gold exploration company Andina Gold
Corp. ("Andina"), a company incorporated and registered in the British Virgin Islands.
Polo has subscribed for 15,898,784 new ordinary shares in Andina at a
price of US$0.244, constituting 31.8 per cent. of its issued shares
Concurrent with the Subscription, Andina issued 3,750,000 new ordinary
shares (in respect of cornerstone finance) for US$506,250 (at US$0.135
per share) and a further 5,351,215 shares for US$1,364,560 (at US$0.255
per share) to third party investors (the "Placing") who have granted a power of attorney to Polo to act as their proxy as
Polo sees fit in respect of the affairs of the company. Parties
related to Stephen Dattels, Neil Herbert, Guy Elliott and Jim Mellon,
directors of Polo subscribed for, in aggregate, 1,996,038 (at US$0.255
per share) new ordinary shares representing approximately 4 per cent.
of Andina's issued shares.
The proceeds of the Subscription and the Placing were used by Andina to
acquire a 100 per cent. interest in a greenfield gold exploration
project in Colombia (the "San Bolivar Gold Project") from R&C Group SAS ("R&C") and other parties. As consideration for the acquisition the vendors
received US$3,750,000 in cash and R&C was granted 25,000,000 new
ordinary shares in Andina (representing 50 per cent. of its issued
shares), with the balance of the Subscription being used for working
Andina shareholders have executed a shareholders' agreement setting out
how the parties will operate the San Bolivar Gold Project. Each of
Polo and R&C will have two director representatives on Andina's board
of four directors and one of Polo's directors will act as Chairman.
Polo has also been appointed as Operator of the exploration phase.
Additionally, under the terms of the shareholders agreement all of the
shareholders of Andina (with the exception of R&C) take on an historic
liability of approximately US$2,900,000 in relation to the San Bolivar
Gold Project. This liability will be financed by the non-R&C parties
and R&C is protected from dilution should further equity be issued. 50
per cent. of the liability is due for payment in February 2012, with
the balance due by August 2012.
Andina is interested in applications for 29 gold concessions in the San
Bolivar area of Colombia which make up the San Bolivar Gold Project.
The Southern Bolívar area of Colombia is the third most important gold
producing region in the country, after Antioquia and Choco. The
Southern Bolivar region is known as a traditional mining district.
Colombia produced during 2009 approximately 47.8 tons of gold, a figure
that is expected to rise.
Polo is currently in the process of finalising its proposed exploration
program which it will present to the Board of Directors of Andina in
the next 4-6 weeks.
Neil L. Herbert, Executive Co-Chairman and Managing Director of Polo
"The San Bolivar Gold Project is another exciting investment by Polo
Resources in South America. Working together with Andina's management
and R&C Group, Polo will lead the exploration efforts of the company in
Colombia in order to deliver shareholder value. This represents a
large and highly prospective area for gold in Colombia. We look forward
to exciting results from Andina's exploration programme."
About the Company
Polo Resources is a natural resources investment company focused on
investing in undervalued companies and projects with strong
fundamentals and attractive growth prospects. The Company will
primarily invest in companies with producing assets and/or resources
and reserves that have been verified under internationally recognised
reporting standards. For complete details on Polo Resources: www.poloresources.com.
The AIM Market of London Stock Exchange plc does not accept
responsibility for the adequacy or accuracy of this release. No stock
exchange, securities commission or other regulatory authority has
approved or disapproved the information contained herein. All
statements, other than statements of historical fact, in this news
release are forward-looking statements that involve various risks and
uncertainties, including, without limitation, statements regarding
potential values, the future plans and objectives of Polo Resources
Limited. There can be no assurance that such statements will prove to
be accurate, achievable or recognizable in the near term.
Actual results and future events could differ materially from those
anticipated in such statements. These and all subsequent written and
oral forward-looking statements are based on the estimates and opinions
of management on the dates they are made and are expressly qualified in
their entirety by this notice. Polo Resources Limited assumes no
obligation to update forward-looking statements should circumstances or
management's estimates or opinions change.
SOURCE Polo Resources Limited
For further information:
Polo Resources Limited
Neil L. Herbert, Executive Co-Chairman
+ 27 82 404 36 37
Andrew Chubb / Bhavesh Patel
+ 44 (0) 20 7050 6500
+1 416 643 6903
Blythe Weigh Communications
+44 (0) 20 7 138 3204