Gabriel Resources Ltd.

Gabriel Resources Ltd.

May 27, 2009 10:47 ET

Gabriel Announces Pricing of Public Offering and Concurrent Private Placement for Aggregate Gross Proceeds of Approximately $100 Million

TORONTO, ONTARIO--(Marketwire - May 27, 2009) -


Gabriel Resources Ltd. ("Gabriel" or the "Company") (TSX:GBU) is pleased to announce that it has priced its previously announced public offering of common shares (the "Offering"). Pursuant to the Offering, the Company will issue 25.9 million common shares ("Common Shares") at a price of $2.25 per Common Share (the "Offering Price"), for aggregate gross proceeds of approximately $58 million. The Company will file an amended and restated preliminary prospectus in each of the provinces of Canada. Cormark Securities Inc. and RBC Capital Markets are acting as Joint Bookrunners of the Offering with a syndicate that includes Canaccord Capital Corporation.

As previously announced, each of Electrum Strategic Holdings LLC and Paulson & Co. Inc., two significant shareholders of the Company have indicated their interest to subscribe for, on a private placement basis (the "Private Placement"), such number of common shares of the Company which, at the minimum would enable them to maintain their respective proportionate interest in the Company, after giving effect to the Private Placement and the Offering, and at a maximum, the number of common shares of the Company which would enable them to increase their percentage interest in the Company to a percentage not equal to or greater than 20.0% of the Company's issued and outstanding shares, after giving effect to the Private Placement and the Offering. The gross proceeds of the Private Placement are expected to be approximately $42 million which, together with the Offering, will provide Gabriel with aggregate gross proceeds of approximately $100 million. Closing of the Private Placement and the Offering will each be conditional upon the closing of the other. The common shares to be issued pursuant to the Private Placement will be subject to the regulatory framework of the Toronto Stock Exchange (the "TSX") which may restrict the number of common shares to be subscribed for. The price per common share under the Private Placement will be the same as the Offering Price.

The Company intends to use the net proceeds of the Offering and the Private Placement to finance the development of the Rosia Montana gold deposit in Romania and for general corporate purposes.

The Common Shares have not been, will not be, registered under the United States 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 by 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, by 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.

About Gabriel

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 the Rosia Montana gold project. For more information please visit Gabriel's website at

Forward-Looking Statements: Certain statements included in this press release, including the anticipated use of the net proceeds of the financing, the expected date of closing of the Offering and the Private Placement, and other statements that express management's expectations or estimates regarding the timing of completion of various aspects of any proposed financing by Gabriel or of our future performance, constitute "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and Canadian securities legislation. The words "believe", "expect", "anticipate", "contemplate", "target", "plan", "intends", "continue", "budget", "estimate", "may", "will", "schedule", and similar expressions identify forward-looking statements. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management, are inherently subject to significant business, economic and competitive uncertainties and contingencies. In particular, the press release includes many such forward-looking statements and such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual financial results, performance or achievements of Gabriel to be materially different from its estimated future results, performance or achievements expressed or implied by those forward-looking statements and its forward-looking statements are not guarantees of future performance. These risks, uncertainties and other factors include, but are not limited to: expectations regarding the gross proceeds to be raised in the Public Offering and the Private Placement and the anticipated use of the net proceeds of the financing. While Gabriel may elect to, Gabriel is under no obligation to and does not undertake to update this information at any particular time, except as required by law.

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