MERCATOR GOLD plc
(“Mercator Gold”, “Mercator” or “the Company”)
US OTC: MTGDY
LONDON: 28 OCTOBER 2005 - Mercator Gold plc (AIM: MCR/MCRW) is pleased to announce that it has entered into agreement to acquire from St Barbara Mines Limited (“SBM”) its entire gold exploration and mining assets in the highly prospective Meekatharra greenstone belt of Western Australia.
The acquisition comprises the 55% balance of the Annean Joint Venture, the 3,000,000 tonnes per annum Bluebird mill and gold processing facility and additional mining and exploration licenses with the potential to transform the Company from explorer to gold producer. The total purchase consideration will comprise AUD$18 million (GBP£7,560,000) in cash and new shares plus the adoption of bonding requirements of approximately AUD$3 million (GBP£1.26 million).
The acquisition represents a “reverse” transaction under the AIM Rules, and accordingly the existing Mercator shares and the warrants of the Company shall be immediately suspended from trading until either (a) the Company mails to its shareholders the necessary meeting materials for shareholder approval of the acquisition (expected to be a date no later than 30 December 2005) or (b) the company elects not to proceed with the acquisition in accordance with the agreement with St Barbara.
The acquisition is subject to a 30-day due diligence period and various shareholder and regulatory approvals.
A more detailed news release will be issued by the Company in due course.
For further information please contact:
|Mercator Gold plc|
|Patrick Harford, Managing Director||Tel:||+44 (0) 20 7929 1010|
|Beaumont Cornish Limited|
|Roland Cornish||Tel:||+ 44 (0) 20 7628 3396|
|King & Shaxson Capital Ltd|
|Nick Bealer||Tel:||+ 44 (0) 20 7426 5986|
|Ocean Equities Ltd|
|Will Slack||Tel:||+ 44 (0) 20 7786 4375|
|Justine Howarth / Ana Ribeiro||Tel:||+ 44 (0) 20 7493 3713|
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