Lero Gold Corporation
TSX VENTURE : LER

Lero Gold Corporation

May 07, 2008 14:04 ET

Lero Gold Corp.-Canaccord Adams Exercise of Over-Allotment Option

LONDON, UNITED KINGDOM--(Marketwire - May 7, 2008) -

THIS NEWS RELEASE IS INTENDED FOR DISTRIBUTION IN THE UK AND IN CANADA ONLY AND IS NOT INTENDED FOR PUBLICATION, RELEASE OR DISTRIBUTION IN OR INTO AUSTRALIA, JAPAN, SOUTH AFRICA, THE RUSSIAN FEDERATION, OR THE UNITED STATES OF AMERICA.

Lero (TSX VENTURE:LER) is pleased to announce that Canaccord Adams Limited ("Canaccord") the sole lead and underwriter of its recent private placement (the "Offering"), has exercised, in full, their over-allotment option referred to in the announcement on 18 April 2008. Pursuant to the over-allotment option, Canaccord has purchased an additional 7,058,823 common shares of the Company at the offering price of Cdn$0.85 per common share for gross proceeds of Cdn$5,999,999.55.

The exercise of the over-allotment option increases the aggregate number of shares sold in the Offering to 77,647,058 common shares in the Company resulting in gross proceeds of approximately Cdn$66 million.

The net proceeds from the Offering will be used primarily to fund a US$25,000,000 loan from Lero to European Minerals Corporation ("EMC") in connection with the proposed acquisition by EMC of all of the outstanding common shares of Lero in exchange for common shares of EMC on a one share for one share basis (see the joint announcement of Lero and EMC of 18 April 2008 for further details), to fund continued exploration and drilling on Lero's Taldybulak Talas (Kyrgyzstan) and Karchiga (Kazakhstan) projects with the remainder being used for working capital and potential acquisitions. EMC plans to use the net proceeds of the loan financing to fund advancement of its mineral projects and for general corporate purposes. The Offering has received conditional regulatory approval and the Offering Shares have been issued to the investors.

This press release does not constitute an offer to sell or the solicitation of an offer to buy any securities of the Company within the United States. The securities of the Company have not been and will not be registered under the United States Securities Act of 1933, as amended (the "1933 Act"), or any state securities laws. Accordingly, the shares may not be offered or sold in the United States or to U.S. persons (as such terms are defined in Regulation S under the 1933 Act) unless registered under 1933 Act and applicable state securities laws or an exemption from such registration is available.

Notes to Editors:

1. No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein.

2. Forward-Looking Information - This news release contains or refers to forward-looking information. All statements, other than statements of historical fact, that address activities, events or developments that EMC and Lero believes, expect or anticipate will or may occur in the future are forward-looking information. Such forward-looking information includes statements contained in this news release regarding the completion of the Acquisition, targets, estimates and/or assumptions in respect of future annual production of gold and copper, costs, commodity prices, mineral resources and reserves, timing of commencement and completion of "hot" commissioning and commencement of operations, potential mineralization and future exploration, development and operational plans and objectives (including delineating additional mineral resources). This forward-looking information reflects the current expectations or beliefs of EMC and Lero based on information currently available to them. Forward-looking information is subject to a number of risks and uncertainties that may cause the actual results of EMC and Lero to differ materially from those discussed in the forward-looking information, and even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on EMC and/or Lero.
Factors that could cause actual results or events to differ materially from current expectations include, but are not limited to: the grade and recovery of ore which is mined varying from estimates; capital and operating costs varying significantly from estimates; inflation; changes in exchange rates; fluctuations in commodity prices; delays in the development or commissioning of, and the commencement of operations at, EMC's Varvarinskoye Project caused by unavailability of equipment, labour or supplies, weather and climatic conditions, delays in the delivery and installation of plant and equipment or otherwise; termination or suspension of EMC's current debt facility; failure of Lero to raise the funds necessary to complete the Acquisition; the failure of EMC and Lero to negotiate the terms under which funds are to be advanced as contemplated herein or to negotiate definitive agreements; delays in obtaining or failure to obtain required regulatory and shareholder approvals; uncertainty of the outcome of any litigation; inability to delineate additional mineral resources or reserves; and other factors. Any forward-looking information speaks only as of the date on which it is made and, except as may be required by applicable securities laws, EMC and Lero disclaim any intent or obligation to update any forward-looking information, whether as a result of new information, future events or results or otherwise. Although EMC and Lero believes that the assumptions inherent in the forward-looking information are reasonable, forward-looking information is not a guarantee of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein.

The TSX Venture Exchange does not accept responsibility for adequacy or accuracy of this release.

Contact Information

  • Lero Gold Corp.
    Dr Sergey V Kurzin
    Chairman
    +44 (0) 20 7514 0590
    or
    Lero Gold Corp.
    Dr Alexander Yakubchuk
    CEO
    +44 (0) 20 7514 0590
    or
    Lero Gold Corp.
    Nick Clarke
    Executive Director
    +44 (0) 20 7514 0590
    or
    Lero Gold Corp.
    Gavin Dallas
    Marketing and PR
    +44 (0) 20 7514 0590
    Email: info@lerogold.com
    Website: www.lerogold.com
    or
    Vanguard Shareholder Solutions
    Keith Schaefer
    (604) 608-0824
    or
    Bankside Consultants
    Michael Padley / Michael Spriggs
    +44 (0) 20 7367 8888