Mercator Gold PLC
20 February 2008
Mercator Gold plc
SALE OF EXPLORATION LEASES
London: 20 February 2008 - Mercator Gold plc ('Mercator' or 'the Company') is
pleased to announce the sale of certain of its non-core exploration leases in
the Meekatharra district of Western Australia to Silver Swan Group Ltd ('Silver
Swan'), an ASX listed company. The tenements are prospective for base metals,
gold and industrial minerals*.
The tenements being sold comprise 46 granted tenements and 14 granted
applications covering approximately 600 sq km representing about 30% of the
Company's total land-holdings in the Meekatharra District.
The consideration for the sale of the tenements to Silver Swan will be satisfied
by the issue to Mercator of 10,000,000 fully paid Silver Swan ordinary shares of
A$0.20 each and 4,000,000 Silver Swan performance shares. These performance
shares will convert to fully- paid ordinary shares subject to certain terms and
conditions, the most notable of which is the proving up of 350,000 ounces of
gold, or gold equivalent, in to the indicated resource category. Silver Swan
presently has 23,350,001 shares in issue. Mercator's initial shareholding of ten
million shares will represent approximately 30% of the issued capital of Silver
Swan. The transaction is subject to a due diligence process and the receipt of
approval from the shareholders of Silver Swan.
Michael Elias, a non-executive director of Mercator, will assume the
Non-Executive Chairman position of Silver Swan and Dr Susan Vearncombe, former
General Manager-Geology of Mercator Gold plc will become the Managing Director
of Silver Swan.
Managing Director of Mercator Gold, Patrick Harford, said:
'The rational for the sale is the tenements, none of which are contiguous with
Mercator's core holdings covering the Paddy's Flat, Yaloginda, Nannine and Reedy
areas, contain numerous base metals and gold prospects that require significant
exploration to develop their full potential; the sale to Silver Swan will allow
that potential to be quickly realised whilst delivering significant benefits to
Mercator's shareholders; and Silver Swan presently has A$2.4 million available
for exploration expenditure and is expected to aggressively develop the
potential of the tenement package.'
* Maps illustrating the tenements sold as well as the tenements retained can be
found in the Press Release section of the Mercator website at
www.mercatorgold.com .
For further information please contact:
Mercator Gold plc
Terry Strapp, Chairman Tel: +61 (0) 412 228 422
Patrick Harford, Managing Director Tel: +44 (0) 20 7929 1010
Email: info@mercatorgold.com
Website: www.mercatorgold.com
Bankside Consultants Ltd Tel: +44 (0) 20 7367 8888
Simon Rothschild
Keith Irons
Oliver Winters
AIM: MCR
This information is provided by RNS
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