Great Western Minerals Group Announces $7 Million Prospectus Offering

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SASKATOON, SASKATCHEWAN--(Marketwire - Jan. 12, 2010) -

(NOT FOR DISTRIBUTION TO THE UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES)

Great Western Minerals Group Ltd. (TSX VENTURE:GWG) (PINK SHEETS:GWMGF) ("GWMG" or the "Company") is pleased to announce that it has filed an amended and restated preliminary short form prospectus with the securities regulatory authorities in the Provinces of British Columbia, Alberta, Saskatchewan, and Ontario in connection with a reasonable best efforts offering of units (the "Units") of GWMG (the "Offering") for gross proceeds of up to $7,000,000, subject to a 15% over-allotment option, at an issue price of $0.28 per Unit. The Offering will be led by Pope & Company Limited (the "Agent").

Each Unit will consist of one common share of GWMG and one-half of one common share purchase warrant (each whole warrant, a "Warrant"). Each Warrant will entitle its holder to purchase one additional Common Share for $0.50 and will expire 60 months after the date of the closing of the Offering, subject to acceleration of the exercise period in certain circumstances. Following the closing of the Offering, if the Company's daily volume weighted average share price is $1.00 or more per share for 10 consecutive trading days on the TSX Venture Exchange, or an equivalent stock exchange, the exercise period of the Warrants will be reduced to 60 days and if not exercised within such period the Warrants shall be deemed expired.

The Agent will receive aggregate cash commission of 7% of the gross proceeds of the Offering, and any over-allotment option thereto, and that number of broker warrants equal to 7% of the total Units placed, and any over-allotment option thereto, excluding therefrom the number of Units purchased by person(s) identified on the President's list. Each broker warrant will entitle its holder to purchase one Common Share for $0.28 for a period of 24 months from the closing date of the Offering.

GWMG plans to use the net proceeds from the Offering for purposes that include, (i) the purchase of new equipment needed to expand product offerings at its wholly owned subsidiary Less Common Metals Ltd. in Birkenhead England ("LCM"), (ii) providing additional working capital for LCM operations, (iii) conducting further exploration activities, and (iv) general working capital purposes.

Jim Engdahl, President and CEO of Great Western Minerals Group said, "With the global recession coming to an end, we've had a significant increase in demand for products from Less Common Metals and Great Western Technologies. Even more encouraging, we've also had requests to expand our range of products to include strip-casting and metal-making. As a result, we will use some of this capital to purchase additional equipment needed to expand our range of products. The addition of these new products has the potential to significantly increase our production output with a corresponding boost to our bottom line. If all goes as expected, we could have this new production on line in Q1 2011."

Engdahl adds, "This financing will also allow us to further improve our balance sheet. Last year, we paid out the long-term debt we took on when we acquired LCM. Now we will be in a position to provide additional working capital to further support the growth opportunities for LCM. These opportunities, combined with the potential from our option agreement on the Rareco project, could allow us to fully realize our mine-to-market strategy in the next 18 to 24 months."

The Offering is expected to close on the second business day following the date on which GWMG has obtained a receipt for the final prospectus qualifying the distribution of the Units, the Warrants and the underlying Common Shares, and the Common Shares issuable on the exercise of the broker warrants, and is subject to certain conditions including, but not limited to, the receipt of all necessary approvals, including the approval of the TSX Venture Exchange.

About Great Western Minerals Group Ltd.

Great Western Minerals Group Ltd. is a Canadian-based company with six rare earth exploration and development properties in North America with an option on a sizable additional property in South Africa. In addition, as part of the Company's strategy to pursue a vertically-integrated business model, the Company's wholly-owned subsidiaries of Less Common Metals Limited located in Birkenhead UK, and Great Western Technologies Inc., located in Troy, Michigan, produce a variety of specialty alloys for use in the battery, magnet and aerospace industries. These "designer" alloys include those containing aluminum, nickel, cobalt and the rare earth elements.

This news release shall not constitute an offer to sell or the solicitation of an offer to buy securities of the Company in any jurisdiction. The securities to be issued pursuant to the Offering by the Company have not and will not be registered under the United States Securities Act of 1933, as amended (the "1933 Act"), or the securities laws of any state of the United States, and may not be offered or sold in the United States absent registration or an applicable exemption therefrom under the 1933 Act and the securities laws of all applicable states.

Certain information set out in this News Release constitutes forward-looking information, which may include information relating to estimates of sales and revenue of GWMG. Forward-looking statements (often, but not always, identified by the use of words such as "expect", "may", "could", "anticipate" or "will" and similar expressions) may describe expectations, opinions or guidance that are not statements of fact and which may be based upon information provided by third parties. Forward-looking statements are based upon the opinions, expectations and estimates of management of the Company as at the date the statements are made and are subject to a variety of known and unknown risks and uncertainties and other factors that could cause actual events or outcomes to differ materially from those anticipated or implied by such forward-looking statements. Those factors include, but are not limited to the ability of the Company and the Agents to successfully complete the Offering, the ability of the Company to obtain a receipt for the Prospectus (whether in the anticipated timeframe or at all), capital expenditure projections, use of proceeds of the Offering, risks, uncertainties and other factors that are beyond the control of the Company, risks associated with the industry in general, commodity prices and exchange rate changes, operational risks associated with exploration, development and production operations, delays or changes in plans, risks associated with the uncertainty of reserve estimates, health and safety risks and the uncertainty of estimates and projections of production, costs and expenses. In light of the risks and uncertainties associated with forward-looking statements, readers are cautioned not to place undue reliance upon forward-looking information. Although the Company believes that the expectations reflected in the forward-looking statements set out in this press release or incorporated herein by reference are reasonable, it can give no assurance that such expectations will prove to have been correct. The forward-looking statements of the Company contained in this press release, or incorporated herein by reference, are expressly qualified, in their entirety, by this cautionary statement and the risk factors contained in the Company's annual information form filed on SEDAR.

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