Lero Gold receives $5.99-million from overallotment

2008-05-07 14:12 ET - News Release

Dr. Alexander Yakubchuk reports

LERO GOLD CORP.-CANACCORD ADAMS EXERCISE OF OVER-ALLOTMENT OPTION

Canaccord Adams Ltd., the sole lead and underwriter of Lero Gold Corp.'s recent private placement, has exercised, in full, its overallotment option referred to in Stockwatch news dated April 18, 2008. Pursuant to the overallotment option, Canaccord has purchased an additional 7,058,823 common shares of the company at the offering price of 85 cents per common share for gross proceeds of $5,999,999.55.

The exercise of the overallotment option increases the total number of shares sold in the offering to 77,647,058 common shares in the company resulting in gross proceeds of approximately $66-million.

The net proceeds from the offering will be used primarily to finance a $25-million (U.S.) 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 in Stockwatch news dated 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.

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