Galane GOLD Ltd. Announces Proposed Acquisition of Vantage Goldfields Limited
For immediate release
GALANE GOLD LTD. ANNOUNCES PROPOSED ACQUISITION OF
VANTAGE GOLDFIELDS LIMITED
TORONTO, ONTARIO – May 23, 2017: Galane Gold Ltd. ( “Galane” or the “Company”)
(TSX-V: GG) is pleased to announce that it has entered into a letter of intent (the “LOI”)
for the acquisition of all of the outstanding shares of Vantage Goldfields Limited
(“Vantage”), a gold mining company with operations in the Mpumalanga Province of
South Africa (the “Acquisition”).
The LOI establishes the terms of the acquisition as between the parties and is expected
to be followed by the execution of a binding acquisition agreement (the “Acquisition
Agreement”) setting forth the detailed terms of the Acquisition and containing
conditions customary in transactions of this nature including completion of satisfactory
legal and technical due diligence, delivery by Vantage of a 43 -101 technical report and
receipt of a ll other necessary regulatory or third party approvals including the approval
of the TSX Venture Exchange and approval of the Business Rescue Practitioner according
to applicable legislation in South Africa . The final structure of the Acquisition will be
determined by Galane and Vantage to accommodate various legal, tax and accounting
considerations. The LOI is not binding (other than certain provisions including exclusivity
obligations) and may be terminated by, among other things, mutual consent or if th e
Acquisition Agreement and related transaction documents have not been entered into by
June 16, 2017. Further details regarding the Acquisition including the consideration to
be paid for the outstanding Vantage shares shall be provided in connection with the
announcement of the signing of the Acquisition Agreement.
CEO Nick Brodie stated “This represents another significant step towards Galane’s stated
goal to reshape the Company into a long -life and low -cost operation that can produce
positive returns for investors across commodity cycles. The Vantage mines are located
within 30 kilometres of our existing operations at Galaxy Gold and obvious synergies
exist between the two operations. We hope to leverage these synergies to create an
operating asset in the Barberton area which, together with the Company’s Galaxy
property, is expected to result in a combined resource exceeding 5,800,000 ounces,
production of over 160,000 ounces per annum and an all in sustaining cost of less than
US$900 per ounce.”(1)(2)(3)
1 Information regarding the quantity of gold produced historically is based on available public sources, has not
been independently verified by the Company and should not be relied upon as a predictor of future results.
2 This is a forward looking statement and is based on a number of assumptions and risks, including the
Company’s ability to successfully comp lete and integrate the acquired assets; gold price volatility; risks
associated with proposed activities in South Africa; regulatory, consent or permitting delays; risks and
unknowns inherent in all mining projects, including the inaccuracy of metallurgica l recoveries and capital and
operating costs of such projects; and operating or technical difficulties in connection with mining or
development activities.
3 The technical disclosure regarding the Galaxy Gold mine is reported in the technical report entitl ed “A
Technical Report on the Galaxy Gold Mine, Mpumalanga Province, South Africa” which was issued January 4,
2016 with an effective date of September 1, 2015 (the “Galaxy Technical Report”), and was prepared by
Minxcon (Pty) Ltd and approved by Daniel va n Heerden, B Eng (Min.), MCom (Bus. Admin.), Pr. Eng.,
FSAIMM, AMMSA, a Qualified Person as defined by National Instrument 43 -101 (“NI 43 -101”). The Galaxy
Technical Report satisfies the requirements to be a pre -feasibility study and was reviewed by the Di rectors of
Minxcon (Pty) Ltd, specifically, Daniel van Heerden; Uwe Engelmann, BSc (Zoo. & Bot.), BSc Hons (Geol.),
Pr.Sci.Nat., MGSSA; Dario Clemente, NHD (Ext. Met.), GCC, BLDP (WBS), MMMA, FSAIMM; and Johan
Vantage Description
Vantage is an Australian company with mining assets located on the Barberton
Greenstone Belt ( “BGB”), proximate to the town of Barberton in the Mpumalanga
Province of South Africa and includes several historical mining operations on the BGB as
well as prospecting rights covering an area of approximately 160 km 2.
Vantage’s Barbrook Mine and Lily Mine suspended operati ons in 2016 due to financial
difficulties and were placed in Business Rescue, a form of creditor protection pursuant to
the laws of South Africa. A plan has been agreed with Vantage management and the
Business Rescue Practitioner that would see operations recommence within 90 days of
the completion of the Acquisition.
The historical estimate set out in the table below (the “ Historical Estimate ”) was
disclosed in a report provided by Vantage to the Company with an effective date of
January 1, 2015 entitled “An Independent Competent Persons’ Report on Vantage
Goldfields Limited, Mpumalanga Province, South Africa”.
Mineral Resource Category Tonnes Grade Content
(t) (g/t) (oz)
Measured 10,541,000 2.54 861,600
Indicated 11,039,000 3.14 1,100,200
Inferred 23,510,000 3.15 2,381,300
Note:
1. All figures are quoted at 100% and not attributable with respect to ownership.
Mineral Reserve Category Tonnes Grade Content
(t) (g/t) (oz)
Proved 685,000 2.89 64,000
Probable 6,408,000 2.68 552,900
TOTAL 7,093,000 2.71 616,900
Notes:
1. Mineral reserves are included in mineral resources.
2. Grade and tonnes reported to plant - head grade.
3. Rounding may cause some apparent discrepancies in totals.
4. All figures are quoted at 100% and not attributable with respect to ownership.
The Historical Estimate was prepared in accordance with the South African Code for the
Reporting of Exploration Results, Mineral Resources and Mineral Reserves (July 2009
Amended Edition) and does not comply with the CIM Definition Standards on Mineral
Resources and Mineral Reserves as required by National Instrument 43 -101 – Standards
of Disclosure for Mineral Projects (“NI 43-101”). The Qualified Person reviewing this
release believes t hat there is no material difference in the definitions. The report was
prepared by a well -known South African advisory company that offers a wide range of
exploration, mining, management, valuation, financing and advisory services. A qualified
person has not done sufficient work to classify the Historical Estimate as current mineral
resources or mineral reserve s in accordance with NI 43 -101. The issuer is not treating
Odendaal, BSc (Geol.), BSc (Min. Econ.), MSc ( Min. Eng.), Pr.Sci.Nat., FSAIMM, MGSSA, all of whom are
Qualified Persons as defined by NI 43 -101 and independent of Galane Gold for the purposes of NI 43 -101. The
Galaxy Technical Report can be found under the Company’s profile on SEDAR (www.sedar.com) an d on the
Company’s website (www.galanegold.com).
the Historical Estimate as current mineral resource s or mineral reserve s and the
Historical Estimate should not be relied on.
The business of mining and mineral exploration, development and production by their
nature contain significant operational risks. The business depends upon, amongst other
things, successful prospecting programmes and co mpetent management. Profitability
and asset values can be affected by unforeseen changes in operating circumstances and
technical issues. Factors such as political and industrial disruption, currency fluctuation
and interest rates could have an impact on future operations, and potential revenue
streams can also be affected by these factors. The majority of these factors are, and will
be, beyond the control of any operating entity.
More recent estimates or data is not available. The Company intends to veri fy the
Historical Estimate based on a NI 43 -101 technical report to be delivered prior to the
closing of the A cquisition. Work required to upgrade or verify the Historical Estimate as
current mineral resources or mineral reserves will be based on recommend ations in the
NI 43 -101 report. The Company will also prepare a mine plan based on
recommendations in the NI 43-101 report.
About Galane
Galane is an un -hedged gold producer and explorer with mining operations and
exploration tenements in Botswana and South Africa. Galane is a public company and its
shares are quoted on the TSX Venture Exchange and the Botswana Stock Exchange
under the symb ol “GG”. Galane ’s management team is comprised of senior mining
professionals with extensive experience in managing mining and processing operations
and large -scale exploration programmes. Galane is committed to operating at world -
class standards and is fo cused on the safety of its employees, respecting the
environment, and contributing to the communities in which it operates.
Cautionary Notes
Certain statements contained in this press release constitute “forward-looking
statements”. All statements other th an statements of historical fact contained in this
press release, including, without limitation, those regarding the Company’s future
financial position and results of operations, strategy, proposed acquisitions, plans,
objectives, goals and targets, and a ny statements preceded by, followed by or that
include the words “believe”, “expect”, “aim”, “intend”, “plan”, “continue”, “will”, “may”,
“would”, “anticipate”, “estimate”, “forecast”, “predict”, “project”, “seek”, “should” or
similar expressions or the negative thereof, are forward -looking statements. These
statements are not historical facts but instead represent only the Company’s
expectations, estimates and projections regarding future events. These statements are
not guarantees of future performance and involve assumptions, risks and uncertainties
that are difficult to predict. Therefore, actual results may differ materially from what is
expressed, implied or forecasted in such forward-looking statements.
Additional factors that could cause actual results, performance or achievements to differ
materially include, but are not limited to: the Company’s ability to complete the
Acquisition including the Galane Financing in accordance with the terms disclosed herein,
or at all ; the Company’s ability to obtain all necessary consents and approvals for the
Acquisition or the Galane Financing; the Company’s dependence on two mineral
projects; gold price volatility; risks associated with the conduct of the Company’s mining
activities in Botswana and South Africa; regulatory, consent or permitting delays; risks
relating to the Company’s exploration, development and mining activities being situated
in Botswana and South Africa; risks relating to reliance on the Company’s management
team and outside contractors; risks regarding mineral resources and reserves; the
Company’s inability to obtain insurance to cover all risks, on a commercially reasonable
basis or at all; currency fluctuations; risks regarding the failure to generate sufficie nt
cash flow from operations; risks relating to project financing and equity issuances; risks
arising from the Company’s fair value estimates with respect to the carrying amount of
mineral interests; mining tax regimes; risks arising from holding derivativ e instruments;
the Company’s need to replace reserves depleted by production; risks and unknowns
inherent in all mining projects, including the inaccuracy of reserves and resources,
metallurgical recoveries and capital and operating costs of such projects; contests over
title to properties, particularly title to undeveloped properties; laws and regulations
governing the environment, health and safety; operating or technical difficulties in
connection with mining or development activities; lack of infrastruc ture; employee
relations, labour unrest or unavailability; health risks in Africa; the Company’s
interactions with surrounding communities and artisanal miners; the Company’s ability
to successfully integrate acquired assets; risks related to restarting pr oduction; the
speculative nature of exploration and development, including the risks of diminishing
quantities or grades of reserves; development of the Company’s exploration properties
into commercially viable mines; stock market volatility; conflicts of interest among
certain directors and officers; lack of liquidity for shareholders of the Company; risks
related to the market perception of junior gold companies; and litigation risk.
Management provides forward -looking statements because it believes they provide
useful information to investors when considering their investment objectives and
cautions investors not to place undue reliance on forward -looking information.
Consequently, all of the forward -looking statements made in this press release are
qualified by these cautionary statements and other cautionary statements or factors
contained herein, and there can be no assurance that the actual results or developments
will be realized or, even if substantially realized, that they will have the expected
consequences to, or effects on, the Company. These forward -looking statements are
made as of the date of this press release and the Company assumes no obligation to
update or revise them to reflect subsequent information, events or circumstances or
otherwise, except as required by law.
Information of a technical and scientific nature that forms the basis of the disclosure in
the press release has been approved by Kevin Crossling B.Sc Earth Sciences (Geology
and Chemistry), B.Sc Honours in Geology, AusIMM and S ACNASP, and a “qualified
person” as defined by National Instrument 43-101.
Neither the 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:
Nick Brodie
CEO, Galane Gold Ltd.
+ 44 7905 089878
www.GalaneGold.com