Lero Gold closes $60-million private placement

2008-04-30 16:48 ET - News Release

Dr. Sergey Kurzin reports

LERO CLOSES CDN$60M PRIVATE PLACEMENT

Lero Gold Corp. has closed the private placement it announced in Stockwatch on April 18, 2008. The company sold, on a bought-deal private placement basis, a total of 70,588,235 common shares of the company at a price of 85 cents per common share for gross proceeds of $60-million. Canaccord Adams Ltd. acted as sole lead and underwriter in connection with the offering. A cash commission equal to 6 per cent of the proceeds was paid to Canaccord. In addition, Canaccord received broker warrants entitling Canaccord to purchase 2,823,529 shares in the capital of the company at a price of 85 cents for a period of 24 months from closing of the offering.

The net proceeds from the offering will be used primarily to finance a $25-million loan from Lero to European Minerals Corp. (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-for-one basis (see the joint news release of Lero and European Minerals, in Stockwatch, on April 18, 2008, for further details), to finance 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 finance 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. The offering shares are subject to a four-month hold period, expiring Aug. 30, 2008.

We seek Safe Harbor.