Medoro Completes Final Stage of the Series of Transactions Leading to Its Joint Venture Interest In the High Grade Frontino Gold Mines in Colombia
TORONTO, ONTARIO -- (Marketwire) -- 08/19/10 -- Medoro Resources Ltd. (TSX VENTURE: MRS) is pleased to announce that in connection with closing the acquisition of the assets of Frontino Gold Mines Ltd. ('Frontino', and the acquisition, the 'Frontino Acquisition'), it has completed the final step in a series of three related transactions by entering into an Exploration, Development and Mine Operating Agreement and Shareholders' Venture Agreement (the 'Joint Venture Agreement') with Gran Colombia, S.A. ('Gran Colombia') which has resulted in Medoro having a 5% joint venture interest in Frontino, with the remaining 95% interest being held by Gran Colombia Gold, all as previously announced by Medoro on August 18, 2010.
Pursuant to the terms of the asset purchase agreement (the 'Frontino Acquisition Agreement') in respect of the acquisition of the Frontino Acquisition, the Frontino Acquisition purchase price was COP380,000,000,000 (approximately US$200,000,000) in cash, of which COP15,000,000,000 was paid on March 31, 2010 as a deposit. After the market close on August 17, 2010, Zandor Capital S.A. ('JVCo'), then a wholly-owned subsidiary of Medoro, entered into a convertible promissory note (the 'Convertible Note') with Gran Colombia pursuant to which Gran Colombia lent COP365,000,000,000 to JVCo so that JVCo could complete the second step in the transaction by closing the Frontino Acquisition on August 18, 2010, as previously announced. In connection with completing the final step in this transaction today, Gran Colombia exercised its conversion right pursuant to the Convertible Note and Medoro and Gran Colombia entered into the Joint Venture Agreement whereby Medoro's interest in JVCo became 5% and Gran Colombia's interest 95% (including, among other things, the back-in right pursuant to which Medoro has the right to increase to a 50% interest in the joint venture), all as described in Medoro's press release issued on August 18, 2010.
About Medoro Resources Ltd.
Medoro Resources Ltd. is a gold exploration, development and mining company with a primary emphasis on Colombia. The Company operates the producing Mineros Nacionales gold mine located in Zona Baja at Marmato and is conducting an exploration and infill drilling program at its Marmato Project to upgrade and expand its gold resources there in anticipation of developing a large tonnage open pit gold mine there.
Medoro also holds a 100% interest in the Lo Increible 4A and 4B concessions in Venezuela where it is continuing its efforts to obtain an exploitation permit to allow development of these gold properties when circumstances in Venezuela allow. Medoro owns interests in gold exploration properties in Mali in respect of which it is seeking possible joint venture partners to further explore these properties.
Additional information on Medoro Resources Ltd. can be found on the Company's website at www.medororesources.com and by reviewing the Company's profile on SEDAR at www.sedar.com.
This news release contains 'forward-looking information', which may include, but is not limited to, statements with respect to the future financial or operating performance of Medoro and its projects, and transactions involving Medoro and JVCo. Often, but not always, forward-looking statements can be identified by the use of words such as 'plans', 'expects', 'is expected', 'budget', 'scheduled', 'estimates', 'forecasts', 'intends', 'anticipates', or 'believes' or variations (including negative variations) of such words and phrases, or state that certain actions, events or results 'may', 'could', 'would', 'might' or 'will' be taken, occur or be achieved. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Medoro to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Forward-looking statements contained herein are made as of the date of this press release and Medoro disclaims, other than as required by law, any obligation to update any forward-looking statements whether as a result of new information, results, future events, circumstances, or if management's estimates or opinions should change, or otherwise. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, the reader is cautioned not to place undue reliance on forward-looking statements.
Neither 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.
Contacts:
Medoro Resources Ltd.
John Hick
President & CEO
(416) 603-4653
Medoro Resources Ltd.
Linda Dorrington
Director, Investor Relations
(416) 603-4653
(416) 360-7783 (FAX)
www.medororesources.com