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TSX Trading Symbol: GBU
TORONTO, March 9 /CNW/ - Gabriel Resources Ltd. ("Gabriel" or the "Company") (TSX - "GBU") is pleased to announce that it has entered into an underwriting agreement with a syndicate of underwriters led by RBC Capital Markets and Sprott Securities Inc. as joint bookrunners, and including BMO Nesbitt Burns Inc., Canaccord Capital Corporation, Merrill Lynch Canada Inc., Orion Securities Inc., Paradigm Capital Inc. and Raymond James Ltd. (collectively the "Underwriters"), to sell a total of 25,000,000 common shares (the "Offering") at a price of Cdn$4.35 per share (the "Offering Price") to raise gross proceeds of Cdn$108,750,000. Gabriel has granted the Underwriters an over-allotment option (the "Option") to purchase up to an additional 3,750,000 common shares at the Offering Price for a period of thirty (30) days after the closing of the Offering, for additional gross proceeds to Gabriel of Cdn$16,312,500 to cover over-allotments, if any, and for market stabilization purposes.
The common shares (the "Shares") will be offered by way of a short form prospectus in all of the provinces of Canada. A preliminary short form prospectus with respect to the Offering has been filed by Gabriel by way of SEDAR with the securities regulatory authority in each of the provinces of Canada. Closing of the Offering is subject to certain conditions, including, but not limited to, receipt of all necessary securities regulatory approvals (including the approval of the Toronto Stock Exchange).
The Company intends to use the net proceeds of the Offering to finance the development of the Rosia Montana gold deposit in Romania.
Newmont Mining Corporation of Canada Limited ("NMCCL"), a subsidiary of Newmont Mining Corporation, has certain participation rights with respect to the Offering pursuant to terms of a subscription agreement between the Company and NMCCL dated August 29, 2004 (the "Subscription Agreement"). Under the terms of the Subscription Agreement, NMCCL has the right to acquire up to 20% of the Offering as well as 20% of the Option. Newmont has a period of five business days within which to confirm to the Company whether it will exercise its rights under the Subscription Agreement.
The Shares have not been, nor will be, registered under the United States Securities Act of 1933, as amended, or any state securities laws and may not be offered or sold in the United States absent registration or applicable exemption from the registration requirement of such Act and applicable state securities laws. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to qualification under the securities laws of any such jurisdiction. Any public offering of securities to be made in the United States would, if made, be made by means of a prospectus that could be obtained from the Company that would contain detailed information about the Company and management as well as financial statements.
Gabriel Resources
Gabriel is a Canadian based resource company committed to responsible mining and sustainable development in the communities in which it operates. Gabriel is currently engaged in the exploration and development of mineral properties in Romania and is presently engaged in the development of its 80% owned Rosia Montana gold project.
Forward-Looking Statements: This press release contains forward-looking statements that are based on the Company's current expectations and estimates. Forward-looking statements are frequently characterized by words such as "plan," "expect," "project," "intend," "believe," "anticipate", "estimate" and other similar words or statements that certain events or conditions "may" or "will" occur, and include, without limitation, statements regarding the closing of the Offering and the Company's plans with respect to the exploration and development of its projects. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause actual events or results to differ materially from estimated or anticipated events or results implied or expressed in such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein.
The Toronto Stock Exchange has not reviewed and does not accept
responsibility for the adequacy or accuracy of this release and the
information contained herein.