Galane Gold Acquires 66% of Galaxy Gold

Galane Gold Ltd. (TSXV:GG) announced that it has closed its previously announced acquisition of a majority of the issued and outstanding ordinary shares Galaxy Gold Mining, gold mining company with operations in the Mpumalanga Province of South Africa.
As quoted in the press release:

Galaxy’s mining assets are located on the Barberton Greenstone Belt (“BGB”), approximately 10 km to the west of the town of Barberton in the Mpumalanga Province of South Africa and include several historical mining operations on the BGB as well as tailings storage facilities comprised of previously mined and processed material. The mining of gold in South Africa began in Barberton, where the first traces of alluvial gold were discovered in 1874. Historic production at Galaxy commenced in the 1880s. To date, the mining assets have produced over one million ounces of gold. The information regarding the quantity of gold produced historically is based on available public sources, has not been independently verified by the Company and should not be relied upon as a predictor of future results.
Galaxy’s existing processing plant is in need of refurbishment and consists of a crushing, milling, flotation, thickening, Biox, carbon in leach, elution and tailings disposal designed to treat 16,000 tonnes of ore per month. This facility can be expanded through refurbishment and the introduction of larger mills and flotation equipment.
Historical Estimate
The historical estimate set out in the table below (the “Historical Estimate”) was disclosed in a report provided by Galaxy to the Company with an effective date of August 30, 2011 entitled “An Independent Competent Persons’ Report on the Galaxy Gold Mineral Assets, Mpumalanga Province, South Africa”.

Mineral Resource Category   Tonnes   Gold GradeContent
                            (t)      (g/t)     (oz)
Measured                    2,113,2003.39      230,520
Indicated                   4,422,9002.85      405,352
Total Measured and Indicated6,536,1003.02      635,872
Inferred                    8,070,0003.40      882,562

The Historical Estimate was prepared in accordance with the South African Code for the Reporting of Exploration Results, Mineral Resources and Mineral Reserves as at June 27, 2011 and does not comply with the CIM Definition Standards on Mineral Resources and Mineral Reserves as required by National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”). A qualified person has not done sufficient work to classify the Historical Estimate as a current mineral resource in accordance with NI 43-101 and the issuer is not treating the Historical Estimate as a current mineral resource. It is expected that a new NI 43-101 technical report will be issued in the upcoming few weeks.
Galane Gold entered into share purchase agreements with certain majority shareholders of Galaxy, pursuant to which a wholly-owned subsidiary of the Company agreed to acquire approximately 74% of the issued and outstanding Galaxy Shares in exchange for 18,334,492 common shares in the capital of the Company (the “Common Shares”), with an aggregate value of approximately Cdn.$2.3 million, based on a deemed price of Cdn.$0.125 per Common Share, and common share purchase warrants (the “Warrants”) exercisable to acquire an aggregate of up to 4,076,599 Common Shares for a period of two years at Cdn.$0.175 per Common Share. Galane acquired 66% of the outstanding Galaxy Shares today with the remaining 8% of the Galaxy Shares held by the majority shareholders of Galaxy expected to close within the next two weeks.

Connect with Galane Gold Ltd. (TSXV:GG) to receive an Investor Kit.