Rio Novo Gold Inc.

Rio Novo Gold Inc.

December 07, 2010 09:23 ET

Rio Novo Gold Announces Closing of CAD$46 Million Bought Deal Financing

Over-Allotment Fully Exercised

TORONTO, ONTARIO--(Marketwire - Dec. 7, 2010) -


Rio Novo Gold Inc. (TSX:RN)(TSX:RN.WT) ("Rio Novo" or the "Company") is pleased to announce that it has closed its previously announced short form prospectus bought deal public offering (the "Offering") with a syndicate of underwriters led by UBS Securities Canada Inc. and Canaccord Genuity Corp. and including Clarus Securities Inc., Dundee Securities Corporation, BMO Nesbitt Burns Inc., GMP Securities L.P., and Credit Suisse Securities (Canada), (collectively, the "Underwriters").

Pursuant to the Offering, Rio Novo issued 20,010,000 ordinary shares of the Company (the "Securities"), including 2,610,000 ordinary shares issued pursuant to the exercise in full by the Underwriters of an over-allotment option, at an issue price of $2.30 per ordinary share for aggregate gross proceeds of $46,023,000. Subsequent to the offering, Rio Novo has 110,760,000 ordinary shares issued and outstanding.

The net proceeds of the offering will be used to execute exploration programs and other studies on both the Almas Gold Project and the Guarantã Gold Project with the goal of advancing the projects to the preliminary economic assessment stage within 12 months from the closing of the offering.

The securities referred to in this press release have not been, and will not be, registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), or applicable state securities laws, and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons (as such term is defined in Regulation S under the U.S. Securities Act) unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration requirements is available. This press release does not constitute an offer to sell or a solicitation of an offer to buy any of these securities within in jurisdiction, including the United States.

About Rio Novo

Rio Novo is currently focused on the acquisition, exploration and development of gold mineral resource properties in Brazil. The Company's goal is to become a producer of gold in the short term by bringing into production its two current material Brazilian properties, the Almas Gold Project, located in Tocantins State, and the Guarantã Gold Project, located in Mato Grosso State. Both projects enjoy established infrastructure in mining friendly jurisdictions. In addition to exploring and developing the Almas Gold Project and the Guarantã Gold Project, the Company intends to identify, explore, develop or acquire additional precious metals properties in Brazil and other proven mineral jurisdictions in South America.

This press release contains forward-looking statements. All statements, other than of historical fact, that address activities, events or developments that the Company believes, expects or anticipates will or may occur in the future (including, without limitation, statements regarding the estimation of mineral resources, exploration results, potential mineralization, potential mineral resources and mineral reserves) are forward-looking statements. Forward-looking statements are often identifiable by the use of words such as "anticipate", "believe", "plan", may", "could", "would", "might" or "will", "estimates", "expect", "intend", "budget", "scheduled", "forecasts" and similar expressions or variations (including negative variations) of such words and phrases. Forward-looking statements are subject to a number of risks and uncertainties, many of differ materially from those discussed in the forward-looking statements. Factors that could cause actual results or events to differ materially from current expectations include, among other things, without limitation, failure to establish estimated mineral resources, the possibility that future exploration results will not be consistent with the Company's expectations, the price of gold and other risks identified in the Company's most recent annual information form filed with the Canadian securities regulatory authorities on Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking statement.

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