TORONTO--(BUSINESS WIRE)--Oct. 14, 2003--
31.7% of Highland Gold's Shares Placed with International Investors;
Proposed Share Issue to Barrick Raising Pounds Sterling 70 Million for
the Company; Appointment of Finance Director
The following Press Release was issued by Highland Gold Ltd.
13 October 2003
Highland Gold, the London quoted Russian gold producer, today
welcomed the successful placing of 31.7% of its equity (the
"Placing"), a stake formerly held by Harmony Gold Mining Company
Limited ("Harmony") of South Africa, with Barrick Gold Corporation
("Barrick") of Canada and with an international group of institutional
investors.
Barrick, one of the world's largest gold producers, has acquired
10% of Highland Gold's equity in the Placing and Highland Gold has
also conditionally agreed to issue a further 29,577,332 shares at the
placing price of 235p per share which, together with the placing
shares, would give Barrick a 29% stake in the Company's enlarged share
capital. This share issue has been approved by the Board of Highland
Gold and is subject to due diligence. It is expected that this will be
completed within two months. After the transaction, the two groups
have agreed to cooperate in the gold sector in the Russian Federation.
Barrick will have the right to nominate two directors to the Board of
Highland Gold and to second certain personnel to the Company.
Highland Gold intends to use part of the proceeds from the share
issue of approximately Pounds Sterling 70 million (US$116 million) to
refinance existing bank debt and to finance the capital requirements
of the Company's development projects. Surplus funds will strengthen
Highland Gold's balance sheet and the Company will continue to search
for acquisitions and investments that will enhance shareholder value.
Highland Gold also reports the appointment to the Board of Denis
Alexandrov as Finance Director. Mr. Alexandrov, who qualified as a
chartered accountant and spent five years with PricewaterhouseCoopers'
Natural Resources Group before joining a UK subsidiary of Alfa Group,
joined Highland Gold earlier this year.
Peter Daresbury, Executive Chairman, Highland Gold, said:
"We would like to thank the Board of Harmony for their energy and
expertise during the creation and development of Highland Gold and we
are grateful in particular to Ted Grobicki, Peter McKenna and Mike
Pleming for their service to the Company as non-executive directors on
our Board throughout Highland Gold's development to date; Mike Pleming
will remain on the Board."
"The successful placing of a substantial stake in Highland Gold
with Barrick and other international investors reflects the progress
the company has made since flotation ten months ago. It is also a
clear indication of global investors' growing confidence in the
investment environment in Russia. We welcome all of our new
shareholders and look forward to their participation in the
considerable development potential of the Group.
"The agreement with Barrick marks a new phase in the progress of
Highland Gold and we are excited about the prospects of developing a
relationship with them in Russia. We believe that Barrick's knowledge
and experience will be of considerable benefit to the Group in
fulfilling its potential in Russia and we welcome them as a
shareholder.
"Finally we welcome Denis Alexandrov to the Board as Finance
Director and look forward to his contribution towards the Group's
success."
Gregory C. Wilkins, President and CEO of Barrick, commented:
"Highland Gold is an attractive and growing mid-tier producer and
this transaction represents a strategic investment opportunity for
Barrick Gold Corporation. It provides us with a window into one of the
world's most prospective gold mining areas. We are making this
investment due to the markedly improved investment climate in Russia,
and an abundance of quality gold targets in this region."
Enquiries:
Highland Gold
Peter Daresbury 0207 409 5600
Brunswick 0207 404 5959
John Sunnucks 07974 982356
Alison Howard 07974 982515
Barrick is a leading international gold producer with the
industry's only A-rated balance sheet, a portfolio of long-life,
low-cost operations on four continents and proven and probable
reserves of 86.9 million ounces of gold. Barrick's shares are traded
under the ticker symbol ABX on the Toronto, New York, London and Swiss
Stock Exchanges and the Paris Bourse.
CONTACT: Barrick Gold Corporation
Vincent Borg, 416-307-7477
416-861-1509 (FAX)
media@barrick.com
SOURCE: Barrick Gold Corporation