ANNOUNCEMENT TO THE TORONTO STOCK EXCHANGE
VANCOUVER, Jan. 7 /CNW/ - The Board of Ratel Gold Limited ("Ratel Gold" or the "Company") (TSX Code: RTL) is pleased to announce that it has closed the
previously announced acquisition of the right to earn a 60 percent
interest in the King-king project by acquiring all of the issued and
outstanding common shares of St. Augustine Mining Inc. and 50 percent
of the issued and outstanding common shares of Strato International
Holdings Limited from Russell Mining and Minerals, Inc. and its
subsidiaries ("RMMI") together with an assignment of RMMI's interest in certain material
contracts relating to the King-king property (the "Acquisition"), as more particularly described in the Company's management
information circular dated November 19th, 2010 (the "Circular").
The King-king project is one of the largest undeveloped copper-gold
deposits in the world, with a measured and indicated equivalent
copper-gold resource of 791.5 Mt at 0.815 g/t equivalent gold for 20.7M
equivalent gold ounces (0.279% Cu for 4.9B lbs of Cu and 0.371 g/t Au
for 9.4M ounces of contained Au) and a further 2.75M equivalent gold
ounces in inferred resources (125.5Mt at 0.237% Cu lbs and 0.308 g/t
As consideration for the Acquisition, Ratel issued 80 million shares to
RMMI upon closing of the Acquisition. A further 75 million shares will
be issuable when a feasibility study is completed on the project (or a
change in control of Ratel occurs).
In connection with the Acquisition, Andrew Russell, Robert Russell, Max
Anhoury and Tom McKiernan have joined the Board of Ratel Gold, and Mark
Savage, Ian Fisher and Ron Clarke have resigned. Andy Russell has been
appointed President and Chief Executive Officer, and Llee Chapman will
serve as Chief Financial Officer.
As a result of the Acquisition, the Company is in the process of
undertaking a name change to "St. Augustine Gold and Copper Limited",
and expects to commence trading under the TSX symbol "SAU" during the
week of January 17th.
The Company is also pleased to announce that the release conditions with
respect to the previously announced C$25 million non-brokered placement
of subscription receipts (the "Non-brokered Placement") have also been satisfied, and 83,333,334 common shares of the Company
have been issued in connection therewith. The net proceeds of the
Non-Brokered Placement will be used to repay an obligation of the
entities acquired pursuant to the Acquisition to CGA Mining Limited, to
fund exploration and feasibility study activities for the King-king
Project and for working capital and general corporate purposes.
Following the closing of the abovementioned transactions and the
exercise of a number of options in Ratel Gold, the issued capital of
the Company post closing is expected to be 260,033,333 shares,
32,800,000 subscriptions receipts issued in connection with the $40
million private placement completed by the Company on December 22, 2010
and 4,800,000 options.
Concurrently with the closing of the Acquisition, Ratel Gold has also
completed the Spin-out Reorganization (as defined in the Circular) of
its African property interests into Ratel Group Limited ("Ratel Group"), a TSX-listed company trading under the symbol "RTG". Pursuant to the
terms of the Spin-out Reorganization, each shareholder of Ratel Gold
has been issued five common shares in the capital of Ratel Group for every nine common shares of Ratel Gold held on the share
distribution record date of January 6, 2011.
As part of the Spin-Out Reorganization, Ratel Group also undertook a
capital raising (the "Spin-out Financing") by way of subscription receipts to fund its future activities and to
satisfy TSX original listing requirements. The subscription receipts
issued in connection with the Spin-out Financing automatically
converted to common shares of Ratel Group as part of the Spin-out
Reorganization, and 100,000,000 common shares of Ratel Group have been
issued in connection therewith.
The board and management of Ratel Group is comprised of the former
directors and management of Ratel Gold.
For further information about the Company, please refer to the Company's
filings on SEDAR (www.sedar.com).
NATIONAL INSTRUMENT 43-101 COMPLIANCE
Mr. James J. Moore, P.E., a qualified person under NI 43-101, has
reviewed the contents of this press release.
A NI 43-101 compliant technical report entitled "King-king Copper-Gold
Project Mindanao, Philippines" dated October 12, 2010 and prepared by
Michael G. Hester, FAusIMM of Independent Mining Consultants, Inc.,
Donald F. Earnest, P.G., of Resource Evaluation, Inc. and John G.
Aronson of AATA International, Inc. has been filed by Ratel on www.sedar.com.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This announcement includes certain "forward-looking statements" within
the meaning of Canadian securities legislation. All statements, other
than statements of historical fact, included herein, without
limitation, the use of net proceeds are forward-looking statements.
Forward-looking statements involve various risks and uncertainties and
are based on certain factors and assumptions. There can be no assurance
that such statements will prove to be accurate, and actual results and
future events could differ materially from those anticipated in such
statements. Important factors that could cause actual results to differ
materially from the Company's expectations include uncertainties
related to fluctuations in gold and other commodity prices and currency
exchange rates; uncertainties relating to interpretation of drill
results and the geology, continuity and grade of mineral deposits;
uncertainties relating to the completion of a bankable feasibility
study; uncertainty of estimates of capital and operating costs,
recovery rates, production estimates and estimated economic return;
uncertainties relating to the conversion of outstanding subscription
receipts; the need for cooperation of government agencies in the
development of the Company's mineral projects; the need to obtain
additional financing to develop the Company's mineral projects; the
possibility of delay in development programs or in construction
projects and uncertainty of meeting anticipated program milestones for
the Company's mineral projects; and other risks and uncertainties
disclosed under the heading "Risk Factors" in the prospectus of the
Company dated June 29, 2010 and the Circular, both filed with the
Canadian securities regulatory authorities on the SEDAR website at www.sedar.com.
SOURCE Ratel Gold Limited
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