Banro Announces C$56,875,000 Private Placement
Toronto, February 4, 2011 - Banro
Corporation ("Banro" or the
"Company") (NYSE AMEX - "BAA" ; TSX -
"BAA") is pleased to announce that it has entered into an
agreement with a syndicate of investment dealers, which have agreed to
sell on behalf of the Company on an underwritten private placement basis
17,500,000 special warrants of the Company (the "Special
Warrants") at a price of C$3.25 per Special Warrant for aggregate
gross proceeds of C$56,875,000 (the "Offering").
Each Special Warrant will entitle the holder thereof to receive one
common share of the Company (a "Common Share"). The Special
Warrants are exercisable by the holders thereof at any time for no
additional consideration, and all unexercised Special Warrants will be
deemed to be exercised on the earlier of: (i) the date that is four
months and one day following closing of the Offering; and (ii) the third
business day after a receipt is issued for a (final) prospectus
qualifying the distribution of the Common Shares by the securities
regulatory authorities in each of the Provinces of Canada, except Quebec,
where the Special Warrants have been sold.
The Company will use its reasonable best efforts to obtain such receipt
by March 31, 2011. However, if the Company fails to qualify the
distribution of the Common Shares underlying the Special Warrants, by
March 31, 2011, then the holders of the Special Warrants will be
entitled, subject to approval by the Toronto Stock Exchange, to receive
1.1 Common Shares in lieu of 1.0 Common Share upon the exercise or deemed
exercise of the Special Warrants.
The Company intends to use the net proceeds to accelerate the ramp up of
the mill at the Twangiza project to 1.7 million
tonnes, to expand its exploration program and
for general working capital purposes.
The Offering is scheduled to close on or about February 24, 2011 and is
subject to certain conditions including, but not limited to, the receipt
of all necessary approvals including the approval of the Toronto Stock
Exchange, the NYSE Amex Equities and the applicable securities regulatory
authorities.
This press release shall not constitute an offer to sell or
solicitation of an offer to buy the securities in any jurisdiction.
These securities offered have not been and will not be registered under
the United States Securities Act of 1933, as amended, and may not be
offered or sold in the United States absent registration or an applicable
exemption from registration requirements.
Banro is a Canadian-based gold exploration and
development company focused on the development of four major,
wholly-owned gold projects, each with mining licenses, along the 210 kilometre-long Twangiza-Namoya
gold belt in the South Kivu and Maniema provinces
of the Democratic Republic of the Congo (the "DRC"). Led by a
proven management team with extensive gold and African experience, the
Company is constructing "Phase I" of its flagship Twangiza project.
Banro's strategy is to unlock shareholder value
by increasing and developing its significant gold assets in a socially
and environmentally responsible manner.
Cautionary Note
Concerning Forward-Looking Statements
This press release
contains forward-looking statements. All statements, other than
statements of historical fact, that address activities, events or
developments that the Company believes, expects or anticipates will or
may occur in the future (including, without limitation, statements
regarding the completion and timing of the offering, estimates and/or
assumptions in respect of gold production, revenue, cash flow and costs,
estimated project economics, mineral resource and reserve estimates,
potential mineralization, potential mineral resources and reserves,
projected timing of gold production and the Company's exploration and
development plans and objectives) are forward-looking statements. These
forward-looking statements reflect the current expectations or beliefs of
the Company based on information currently available to the Company.
Forward-looking statements are subject to a number of risks and
uncertainties that may cause the actual results of the Company to differ
materially from those discussed in the forward-looking statements, and
even if such actual results are realized or substantially realized, there
can be no assurance that they will have the expected consequences to, or
effects on the Company. Factors that could cause actual results or events
to differ materially from current expectations include, among other
things: the need to negotiate and execute an underwriting agreement and
related documents, need for continued cooperation of the underwriters,
need to successfully market the offering, need for regulatory and stock
exchange approvals, satisfaction of conditions to closing, uncertainty of
estimates of capital and operating costs, production estimates and
estimated economic return; the possibility that actual circumstances will
differ from the estimates and assumptions used in the economic studies of
the Company's projects; failure to establish estimated mineral resources
or reserves; fluctuations in gold prices and currency exchange rates;
inflation; gold recoveries being less than those indicated by the
metallurgical testwork carried out to date
(there can be no assurance that gold recoveries in small scale laboratory
tests will be duplicated in large tests under on-site conditions or
during production); changes in equity markets; political developments in
the DRC; lack of infrastructure; failure to procure or maintain, or
delays in procuring or maintaining, permits and approvals; lack of
availability at a reasonable cost or at all, of plants, equipment or labour; inability to attract and retain key
management and personnel; changes to regulations affecting the Company's
activities; uncertainties relating to the availability and costs of
financing needed in the future; the uncertainties involved in
interpreting drilling results and other geological data; and the other
risks disclosed under the heading "Risk Factors" and elsewhere
in the Company's annual information form dated March 29, 2010 filed on
SEDAR at www.sedar.com and EDGAR at www.sec.gov. Any forward-looking
statement speaks only as of the date on which it is made and, except as
may be required by applicable securities laws, the Company disclaims any
intent or obligation to update any forward-looking statement, whether as
a result of new information, future events or results or otherwise.
Although the Company believes that the assumptions inherent in the
forward-looking statements are reasonable, forward-looking statements are
not guarantees of future performance and accordingly undue reliance
should not be put on such statements due to the inherent uncertainty
therein.
For further information, please visit our website at www.banro.com, or
contact: Simon Village, Chairman, United Kingdom, Tel: +44 1959 569 237,
Arnold T. Kondrat, Executive Vice-President,
Toronto, Ontario, or Martin Jones, Vice-President, Corporate Development,
Toronto, Ontario, Tel: (416) 366-2221 or 1-800-714-7938.
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