High River Gold Mines Ltd.
TSX : HRG

High River Gold Mines Ltd.

October 18, 2007 16:12 ET

High River Gold Mines Ltd. Announces C$100 Million "Bought Deal" Financing

TORONTO, ONTARIO--(Marketwire - Oct. 18, 2007) -

NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES.

High River Gold Mines Ltd. (TSX:HRG) ("High River", the "Company") announced today that it has entered into an agreement with a syndicate of investment dealers led by GMP Securities L.P., and including CIBC World Markets Inc., Cormark Securities Inc., and Dundee Securities Corp. (the "underwriters"), which have agreed to purchase, on a bought deal basis, 32.3 million Units of High River Gold at a purchase price of $3.10 per unit (a "Unit"), for aggregate gross proceeds in the amount of approximately $100 million. Each Unit consists of one common share and one-half of one common share purchase warrant ("warrant"). Each full warrant can be exercisable for a common share in the Company at a price of $4.00 for a period of 3-years following the closing date. High River Gold plans to use the net proceeds of this financing to pay down debt, to fund exploration and for general corporate purposes including working capital.

The company has granted to the Underwriters an over-allotment option, exercisable in whole or in part for a period of up to 30 days following the closing of the offering, to purchase up to an additional 4.845 million Units at the offering price, to cover over-allotments, if any. If the over-allotment option is fully exercised, the total gross proceeds of the financing will be approximately $115 million. The Units to be issued under the offering will be offered by way of a short form prospectus in each of the provinces of Canada, other than Quebec and in the United States on a private placement basis pursuant to an exemption from the registration requirements of the United States Securities Act of 1933, as amended.

The offering is scheduled to close on or about November 8, 2007 and is subject to certain conditions including, but not limited to, the receipt of all necessary approvals including the approval of the Toronto Stock Exchange and the securities regulatory authorities.

These securities offered have not been registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States or to, or for the account or benefit of, U.S. persons absent registration or an applicable exemption from registration requirements. This release does not constitute an offer for sale of securities in the United States.

High River is a gold company with operating and developing mines in the Russian Federation and Burkina Faso, is bringing two new open-pit gold mines into production this year, the Taparko-Bouroum Gold Mine in Burkina Faso (September) and the Berezitovy Gold Mine in Russia (Q4 2007). Annual gold production from Taparko-Bouroum is planned at 100,000 ounces for the first 12 months increasing to over 140,000 ounces in the third year of operation, and annual production from Berezitovy is expected to exceed 100,000 ounces. Combined with gold production from High River's 85%-owned Russian subsidiary, OJSC Buryatzoloto, High River's attributable unhedged gold production is expected to be approximately 175,000 ounces in 2007, and to exceed 300,000 ounces in 2008. In addition, the Company has two advanced exploration projects, the Bissa Gold Project in Burkina Faso and the world-class Prognoz Silver Project in Russia. These projects are expected to significantly add to the Company's production profile in the future.

Contact Information

  • High River Gold Mines Ltd.
    Investor Relations
    (416) 947-1440
    Website: www.hrg.ca