TORONTO, May 15 /CNW/ - Guyana Goldfields Inc. (TSX:GUY) ("Guyana" or the "Company") is pleased to announce a non-brokered private placement pursuant to which Guyana proposes to issue up to 4,381,818 units ("Units") at a price of $2.75 per Unit for aggregate gross proceeds of up to $12,050,000. Each Unit will consist of one common share and one-half of one common share purchase warrant. Each whole warrant shall be exercisable at any time for one common share at a price of $4.00 per share for a period of three years following closing. The Company shall have the right to call the outstanding warrants should the closing price of its common shares exceed $6.00 for 30 consecutive trading days after one year has elapsed from the closing date.
The International Finance Corporation (IFC), the member of the World Bank Group focused on private sector investments in developing countries, and a current shareholder in the Company, has agreed to purchase $5,000,000 (1,818,181 Units) of the private placement, subject to approval by its Board of Directors. Upon closing of the private placement the IFC will hold an aggregate of 3,548,181 shares (5.6%) of Guyana. Claude F. Lemasson, P.Eng, MBA, the recently appointed President and Chief Operating Officer of the Company has agreed to purchase $1,000,000 (363,636 Units) of the private placement. Current and existing shareholders have agreed to purchase the remaining $6,050,000 (2,200,000 units).
The net proceeds of the private placement will be used to complete the previously announced Definitive Feasibility Study undertaken by AMEC, Canada, to continue exploration of the Company's portfolio of gold exploration properties in Guyana, South America and for general working capital purposes. The private placement remains subject to the approval of the Toronto Stock Exchange.
The securities described herein have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States unless registered under the Act or unless an exemption from registration is available.
IFC, a member of the World Bank Group, creates opportunity for people to escape poverty and improve their lives. IFC fosters sustainable economic growth in developing countries by supporting private sector development, mobilizing private capital, and providing advisory and risk mitigation services to businesses and governments. IFC's new investments totaled $16.2 billion in fiscal 2008, a 34 percent increase over the previous year. For more information, visit www.ifc.org.
Guyana Goldfields Inc. is a Canadian based mineral exploration company primarily focused on the exploration and development of gold deposits in Guyana, South America where the Company has operated since 1996. The Company is currently undertaking technical studies to advance and develop the Aurora Project in Guyana.
As previously announced, (see press release dated December 8, 2008 at www.sedar.com under the Guyana Goldfields Inc. profile, "Guyana Goldfields Announces Increased Resource at Aurora 3.69 Million Ounces Measured and Indicated and 1.72 Million Ounces Inferred"), the Aurora Gold Project contains a Measured resource of 8.08 million tonnes @ 4.11 g/t Au., an Indicated resource of 21.06 million tonnes @ 3.87 g/t Au. and an Inferred resource of 19.97 million tonnes @ 2.77 g/t Au. Mr. D. K. Mukhopadhyay, MAusIMM, Senior Mineral Resource Geologist of Micon International Co. Limited, reviewed and approved the technical data in his capacity of a Qualified Person under National Instrument 43-101. For further details, please refer to the technical report of Guyana dated November 23, 2007 entitled "Technical Report: A Mineral Resource Estimate For the Rory's Knoll, East Walcott and Aleck Hill Zones, Aurora Gold Property, Guyana" available on SEDAR at www.sedar.com.
Forward Looking Statements - Certain information set forth in this news release may contain forward-looking statements that involve substantial known and unknown risks and uncertainties. These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond the control of Guyana, including, but not limited to the impact of general economic conditions, industry conditions, volatility of commodity prices, risks associated with the uncertainty of resource and reserve estimates, currency fluctuations, dependence upon regulatory approvals, the availability of future financing and exploration risk. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements.