Cerro Resources NL

Cerro Resources NL

February 25, 2011 09:09 ET

Cerro Resources NL Announces A$17.8M Placement

LONGUEUIL, QUEBEC--(Marketwire - Feb. 25, 2011) - Cerro Resources NL (ASX:CJO)(TSX VENTURE:CJO) (the "Company") has agreed to place a total of 89,290,470 fully paid ordinary shares at a price of A$0.20 per share to raise gross proceeds of A$17,858,094.

The placement is being made through Patersons Securities Limited ("Patersons") to sophisticated and professional investors. In connection with this placement, the Company has agreed to issue to Patersons a total of 5,000,000 options at an exercise price of A$0.27 cents per share with a maturity of 2 years.

Importantly the funding will allow the Company to accelerate the exploration of the highly prioritised Namiquipa Silver project, allow the Company to consider a further increase in the activity at Mt Philp Iron Ore post the first stage of resource drilling and to review further exploration project opportunities in Mexico. The Company expects to hold in excess of A$21M in cash after closing of the placement, which should occur on or about March 2, 2011.

The placement is subject to receipt of approval of the TSX Venture Exchange. The placement is within the 15% permitted under Listing Rule 7.1 and is an excluded issue under Section 708 of the Corporations Act. Shareholders will be asked to ratify this placement at the next general meeting of shareholders.

About Cerro Resources

Cerro Resources is a precious and base metals exploration and development company. The Company is currently focused on developing the Cerro del Gallo gold/silver project in the central state of Guanajuato, Mexico and maintains an active working focus on the Mt Isa exploration project, Queensland, Australia.

Additional information about the Company is available on the Company's website at www.cerroresources.com and on SEDAR at www.sedar.com.

Forward-Looking Information

This news release contains certain "forward-looking information" under Canadian securities laws. All statements that address future plans, activities, events or developments that the Company believes, expects or anticipates will or may occur are forward-looking information. Forward looking information is based upon assumptions by management that are subject to known and unknown risks and uncertainties beyond the Company's control, including risks related to mining exploration and the availability of financing for companies such as the Company. There can be no assurance that outcomes anticipated in the forward looking information will occur, and actual results may differ materially for a variety of reasons. Accordingly, readers should not place undue reliance on forward-looking information. The Company undertakes no obligation to update publicly or otherwise revise any forward-looking information, except as may be required by law.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Tony McDonald, Managing Director
    Craig McPherson, Chief Financial Officer
    +61 7 3252 0122
    For North America, please contact:
    Ms Gerri Paxton
    Manager Investor Relations