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LEGEND MINING LIMITED Capital/Financing Update 2004
65223_rns_2004-09-14_12836d53-4249-4d1a-a61b-58f943e7b56b.pdf
Capital/Financing Update
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LEGEND MOVES TO DOMINANT POSITION IN THE GIDGEE REGION IN PARTNERSHIP WITH THE CREASY GROUP
The Directors of Legend Mining Limited ("Legend") are pleased to announce that they have entered into an agreement with the Mark Creasy controlled Gidgee Resources Limited ("Gidgee"), which Legend believes has the potential to propel the high-grade Gidgee Gold Mine project into one of Australia's major exploration and gold producers.
The transaction will involve Mark Creasy and his team, led by well-known geologist Dermot Ryan, becoming involved in the operations of Legend by providing the following:
- The expertise of the Creasy Group who may nominate one Board representative.
- Significant increase in exploration potential adding 2,000 square kilometres of tenements surrounding and overlapping with Legend's existing 600 square kilometres (see attached map and table). Previous exploration on Gidgee's holdings has identified many untested or shallowly drilled gold targets, including at least 34 historical gold occurrences which produced approximately 23,000 ounces.
- Control of almost all of the Gum Creek Greenstone Belt, a highly prospective geological unit which lies between Sandstone and Meekatharra and has past gold production of approximately 1.5 million ounces.
- Commencement of an aggressive drilling program to expand Legend's known resources and reserves and test the already identified targets on the combined lease holdings. During this drilling program there will be a reduction in underground mining and milling, plans for which are being drawn up and will be reported when completed.
- An investment of \$5,000,000 into Legend via a convertible note from the Creasy Group mainly to repay existing liabilities and also to provide working capital.
The Managing Director of Legend, Mr Murray McDonald, said "this merger is an exciting step in the evolution of Legend and positions Legend to advance a wide range of exploration targets with the intention of becoming a major gold explorer and producer."
Mr Mark Creasy said "the Belt is under explored and there is significant potential for discovery of further large highgrade gold deposits and base metal deposits. I am pleased to have the opportunity to work with Legend to fully explore the Belt given the strength of the combined land position, the resources and reserves and the existing infrastructure."
Legend is in the process of completing a capital raising through the issue of 22,000,000 shares at a price of 7 cents per share to raise \$1,540,000. This raising is within the 15% rule and does not require shareholder approval.
The material terms of the agreement are as follows:
- Legend will issue \$3,000,000 in shares at a price of 7 cents each for the acquisition of all "Gidgee" shares (the entity that controls approximately 2,000 square kilometres of additional tenements in the Gidgee region).
- The convertible note (\$5,000,000) will be convertible into ordinary shares of Legend at a price of 7 cents per share in the first twelve months and thereafter at a premium of 25% to this price or the prevailing market price if below 7 cents per share.
- Legend will complete a further capital raising of no less than \$1,500,000 within 90 days of receiving shareholder approval for the transaction.
This proposed transaction will be subject to shareholder approval and Legend will, in the near future, forward a Notice of Meeting to all shareholders setting out details.
Ernst & Young Mergers and Acquisitions has facilitated this transaction and acted as lead financial advisor to Legend in this transaction.
For further details please contact:
| Murray McDonald | Dermot Ryan |
|---|---|
| $(08)$ 9322 3700 | $(08)$ 9289 9100 |
GIDGEE RESOURCES LIMITED TENEMENT SCHEDULE
| TENID | TYPE | SURVSTATUS | TENSTATUS | Area_SqKm | |
|---|---|---|---|---|---|
| F. | 5101046 | Exploration Licence | Unsurveyed | Pending | 214.329 |
| F | 5101054 | Exploration Licence | Unsurveyed | Pending | 36.7898 |
| F | 5301091 | Exploration Licence | Unsurveyed | Pending | 97.9761 |
| Ë | 5301092 | Exploration Licence | Unsurveyed | Pending | 6.12033 |
| F | 5301093 | Exploration Licence | Unsurveyed | Pending | 214.053 |
| E | 5301108 | Exploration Licence | Unsurveyed | Pending | 36.6875 |
| F | 5700564 | Exploration Licence | Unsurveyed | Pending | 121.673 |
| F | 5700565 | Exploration Licence | Unsurveyed | Pending | 213.089 |
| Е | 5700566 | Exploration Licence | Unsurveyed | Pending | 213.337 |
| F | 5700567 | Exploration Licence | Unsurveyed | Pending | 186.052 |
| F | 5700568 | Exploration Licence | Unsurveyed | Pending | 213.785 |
| F | 5700569 | Exploration Licence | Unsurveyed | Pending | 213.776 |
| Ë | 5700570 | Exploration Licence | Unsurveyed | Pending | 3.04767 |
| F. | 5700571 | Exploration Licence | Unsurveyed | Pending | 63.9605 |
| E | 5700572 | Exploration Licence | Unsurveyed | Pending | 33.5898 |
| F | 5700574 | Exploration Licence | Unsurveyed | Pending | 27.4479 |
| E | 5700575 | Exploration Licence | Unsurveyed | Pending | 39.7001 |
| Р. | 5700588 | Exploration Licence | Unsurveyed | Pending | 212.985 |
| Total | 2148 |
| TENID | TYPE | SURVSTATUS | TENSTATUS Area_SqKm | |
|---|---|---|---|---|
| F 5100854 |
Exploration Licence | Unsurveyed | f íve | 6.12875 |
| Ë | 5100855 Exploration Licence | Unsurveyed | Live | 12.2453 |
| Ë | 5100899 Exploration Licence | Unsurveyed | Pendina | 18.3584 |
| E 5100934 Exploration Licence | Unsurveyed | Pendina | 205.06 | |
| E 5300826 Exploration Licence | Unsurveyed | Live | 0.871303 | |
| M 5100837 Mining Lease | Unsurveyed | Pending | 9.18795 | |
| M 5100838 Mining Lease | Unsurveyed | Pendina | 9.1861 | |
| M 5100839 Mining Lease | Unsurveyed | Pendina | 6.12282 | |
| M 5100840 Mining Lease | Unsurveyed | Pendina | 8.57802 | |
| M | 5100841 Mining Lease | Unsurveyed | Pendina | 4.4411 |
| M 5301006 Mining Lease | Unsurveyed | Pendina | 5.46052 | |
| M 5301007 Mining Lease | Unsurveyed | Pendina | 4.46934 | |
| M 5700523 Mining Lease | Unsurveyed | Pendina | 5.71666 | |
| M 5700524 Mining Lease | Unsurveyed | Pendina | 7.42719 | |
| M 5700525 Mining Lease | Unsurveyed | Pendina | 2.3164 | |
| P 5102499 Prospecting Licence | Unsurveyed | Pendina | 1.78254 | |
| P 5301010 Prospecting Licence | Unsurveyed | Live | 1.36572 | |
| P 5301011 Prospecting Licence | Unsurveyed | Live | 1.64908 | |
| P 5301012 Prospecting Licence | Unsurveyed | Live | 1.62948 | |
| P | 5301013 Prospecting Licence | Unsurveyed | Live | 0.441625 |
| P 5301014 | Prospecting Licence | Unsurveyed | Live | 1.65284 |
| P 5301015 | Prospecting Licence | Unsurveyed | Live | 1.71431 |
| P | 5301016 Prospecting Licence | Unsurveyed | Live | 1.10218 |
| P 5700913 Prospecting Licence | Unsurveved | Live | 1.06872 | |
| P 5700914 | Prospecting Licence | Unsurveyed | f íve | 124768 |
| P 5700917 | Prospecting Licence | Unsurveyed | Live | 191349 |
| P 5700918 Prospecting Licence | Unsurveyed | l íve | 1.84917 | |
| P 5700919 Prospecting Licence | Unsurveyed | Live | 1.95401 | |
| P 5700920 Prospecting Licence | Unsurveyed | f íve | 1.83042 | |
| P 57009211 | Prospecting Licence | Unsurveyed | Live | 1.82813 |
| P 57009221 | Prospecting Licence | Unsurveyed | Live | 1.95163 |
| P 5700923 | Prospecting Licence | Unsurveyed | Live | 1.81702 |
| Total | 332.3 |