SASKATOON, SASKATCHEWAN--(Marketwire - Oct. 27, 2011) -
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Great Western Minerals Group ("GWMG" or the "Company") (TSX VENTURE:GWG) (OTCQX:GWMGF) is pleased to announce that it has engaged a syndicate of agents (the "Agents") co-lead by Byron Capital Markets Ltd. and Cormark Securities Inc., and including GMP Securities L.P., to complete a brokered private placement financing, on a best efforts agency basis, of a minimum of $15,000,000 of common shares of GWMG. The pricing of the offered shares will be determined by the Company and Agents in the context of the market.
The Company plans to use the proceeds for the continued development of its Steenkampskraal project in South Africa as well as for general corporate expenses.
GWMG President and Chief Executive Officer Jim Engdahl said, "This financing will move GWMG one more important step toward its goal of being a fully integrated rare earth producer. We have carefully considered the various financing options available and feel an equity financing will provide the Company with the greatest flexibility in the short term. Ensuring we have adequate capital on hand puts our Company in a much stronger position as we continue to evaluate non-dilutive financing mechanisms such as joint ventures/off-take agreements and debt instruments."
Additionally, the Company announces that it has deferred the planned Special Meeting of shareholders originally scheduled for November 22, 2011.
The Company had contemplated a re-confirmation of shareholder approval for undertaking a share consolidation originally approved by shareholders at the Company's Annual General Meeting of August 11, 2010.
Given current global financial market conditions, GWMG has concluded that a share consolidation would not be in the best interests of its shareholders at this time.
GWMG President and Chief Executive Officer Jim Engdahl said, "Our Company evaluated this strategic decision very carefully. A share consolidation can be a catalyst that enables GMWG to fully access a broader capital markets strategy, and on that basis, could be of benefit to shareholders. The current financial market conditions, however, intervened and the Company's assessment was that shareholders' interests would not be served by proceeding at this point."
Great Western Minerals Group Ltd. is an integrated Rare Earths processor. Its specialty alloys are used in the battery, magnet and aerospace industries. Produced at the Company's wholly owned subsidiaries Less Common Metals Limited in Birkenhead, U.K. and Great Western Technologies Inc. in Troy, Michigan, these alloys contain aluminium, nickel, cobalt and Rare Earth Elements. As part of the Company's vertical integration strategy, GWMG also holds 100% equity ownership in Rare Earth Extraction Co. Limited, which owns a 74% equity interest in the Steenkampskraal Mine. In addition to an exploration program at Steenkampskraal, GWMG also holds interests in four active Rare Earth exploration and development properties in North America.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any state in the United States in which such offer, solicitation or sale would be unlawful. The securities referred to herein have not been and will not be registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. This press release may contain statements within the meaning of safe harbour provisions as defined under United States Securities Laws and Regulations. The above statements are based on the current expectations and beliefs of management and are subject to a number of risks and uncertainties that may cause the actual results to differ materially from those described above.
Certain information set out in this News Release constitutes forward-looking information. Forward-looking statements (often, but not always, identified by the use of words such as "expect", "may", "could", "anticipate" or "will" and similar expressions) may describe expectations, opinions or guidance that are not statements of fact and which may be based upon information provided by third parties. Forward-looking statements are based upon the opinions, expectations and estimates of management of GWMG as at the date the statements are made and are subject to a variety of known and unknown risks and uncertainties and other factors that could cause actual events or outcomes to differ materially from those anticipated or implied by such forward-looking statements. Those factors include, but are not limited to completion of the proposed financing on the anticipated terms or at all, refurbishment activities and reliance on third parties to meet projected timelines, the results of the exploration program at Steenkampskraal, a resource estimate and commencement of production at Steenkampskraal, satisfaction of the conditions precedent with respect to GWMG's offtake agreement, receipt of all required approvals (including those relating to the commencement of production at the Steenkampskraal mine) and risks, uncertainties and other factors that are beyond the control of GWMG, risks associated with the industry in general, commodity prices and exchange rate changes, operational risks associated with exploration, development and production operations, delays or changes in plans, risks associated with the uncertainty of reserve or resource estimates, health and safety risks and the uncertainty of estimates and projections of production, costs and expenses. In light of the risks and uncertainties associated with forward-looking statements, readers are cautioned not to place undue reliance upon forward-looking information. Although GWMG believes that the expectations reflected in the forward-looking statements set out in this press release or incorporated herein by reference are reasonable, it can give no assurance that such expectations will prove to have been correct. The forward-looking statements of GWMG contained in this News Release, or incorporated herein by reference, are expressly qualified, in their entirety, by this cautionary statement and the risk factors contained in GWMG's current annual information form available at www.sedar.com.
CUSIP: 39141Y 10 3
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