VANCOUVER, Jan. 27 /PRNewswire-FirstCall/ - New Gold Inc. ("New Gold") (TSX and NYSE AMEX-NGD) today announces the signing of an agreement to sell its Brazilian subsidiary Mineracao Pedra Branca do Amapari Ltda. ("MPBA"), which holds the Amapari mine and other related assets, to Beadell Resources Ltd. ("Beadell") (ASX-BDR) for $63 million. Beadell is an Australian listed gold-focused company with exploration and development assets in Western Australia and Brazil.
Proceeds to New Gold will be $46 million in cash and $17 million in Beadell shares and are contingent on the successful completion of an A$75 million equity offering by Beadell, to be sole lead managed by Macquarie Capital Advisers Limited in Australia, and related shareholder approvals. The Macquarie Fixed Income, Currencies and Commodities Group of Macquarie Bank Limited and Macquarie Capital Group Limited have committed to subscribe for a total A$10 million of Beadell shares (A$5 million each) at the bookbuild price up to A$0.25 per share, subject to a number of conditions including successful completion of the offering and the acquisition.
"We are pleased with this transaction as it provides the company with meaningful cash proceeds while still participating in Amapari's future success as a Beadell shareholder," stated Randall Oliphant, Executive Chairman. "New Gold views this as an opportunity to successfully monetize the Amapari asset which will provide the company further flexibility as it pursues other growth opportunities."
As part of the planned equity offering, Beadell is required to obtain shareholder approval by simple majority of 50% plus one of those votes cast. The shareholder meeting materials will be distributed in the coming days and the shareholder vote will take place in early March. Beadell management, who hold approximately 25% of the shares of the company, have committed to support the transaction both financially and through the shareholder vote where applicable. Once the bookbuild has been successfully completed, expected to be on or about February 17, 2010, the completion of the transaction will be dependent on the above noted shareholder approvals and other customary closing conditions.
The transaction is expected to close in March 2010.
About New Gold
New Gold is an intermediate gold mining company with the Mesquite Mine in the United States, Cerro San Pedro Mine in Mexico and Peak Mines in Australia. The company is expected to produce between 330,000 and 360,000 ounces of gold in 2010 growing to over 400,000 ounces in 2012. In addition, New Gold has a strong portfolio of development and exploration assets in North and South America. For further information on the company, please visit www.newgold.com.