Keegan Remains on Track to Deliver Esaase Gold Project Under New Name Asanko
VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 02/19/13 -- Keegan
Resources Inc. ("Keegan" or "Company") (TSX:KGN)(NYSE MKT:KGN)
announced yesterday that Keegan and PMI Gold Corporation have agreed
by mutual written consent to terminate the definitive arrangement
agreement (the "Arrangement") to combine their respective business by
way of court-approved plan of arrangement.
The deadline for voting by proxy on the Arrangement closed on Friday
February 15, 2013 at 4:30pm PST. The voting demonstrated that Keegan
Shareholders overwhelmingly supported the transaction with over 99%
of the proxies received being in favour. Similarly, the majority of
PMI's Shareholders also supported the Arrangement with proxies
received for over 70% of the issued and outstanding shares and 56% of
those proxies FOR the merger transaction. It was determined that the
threshold for approval of the Arrangement of 66 2/3% could not
practically be obtained as a small group of PMI Shareholder continued
to oppose the Arrangement despite numerous attempts to find
acceptable terms to allow the Arrangement to proceed.
The Keegan special meeting scheduled for 4:30 pm today, February 19,
2013 will proceed but only to consider the approval of a name change
of Keegan to Asanko Gold Corp, reflective of the region in Ghana
where it operates. The name change is expected to be fully effected
in early March.
Keegan continues to aggressively pursue its transition from an
exploration and development company to a near term African focused
gold producer by advancing its Esaase Gold Project ("Esaase") in
Ghana towards construction in Q4 2013 and ultimately production in
2015. Completion of the various Feasibility Studies and the
permitting process remain on track for Q3 2013.
Commenting on the matter, Peter Breese, President and CEO, stated:
"While it is disappointing that a few PMI Shareholders would not
support the value accretive merger between PMI and Keegan, which
would have resulted in both groups of Shareholders realizing maximum
value, I am pleased with the significant progress being made at
"We are well funded with $205 million in cash and we are moving
forward according to our development timetable. The next milestone we
expect to complete will be the PFS, with the results published in Q2
Over the past six months Keegan has implemented several fundamental
changes to its strategic and operational plans in order to de-risk
the evolution of Keegan from an explorer to a gold producer
-- Launching a revised Pre Feasibility Study ("PFS") targeting 180,000 to
200,000 ounces of gold production for at least 10 years with a capital
cost of approximately $260 million. Completion of the PFS is expected
towards the end of Q1 2013 and will be announced to the market in Q2
-- Upgrading the Esaase NI 43-101 resource estimate to 68.92 million tonnes
("Mt") averaging 1.73 grams per tonne of gold for 3.83 million ounces in
the Measured and Indicated category as well as 22.23Mt averaging 1.75
grams per tonne of gold for 1.25 million ounces in the Inferred Resource
category (all at a 0.8 gram per tonne Au cut-off grade).
-- Investment of initial $32.5 million by strategic investor Highland Park
to further strengthen the Company's balance sheet. As at December 31,
2012 the Company had $205 million in cash.
-- Recruitment of an experienced mine building and operating team led by
Peter Breese, President and CEO and Tony Devlin, COO.
-- Completing the acquisition of 10.3 square kilometres of high priority
exploration ground immediately on strike within the same structural
setting to the southwest of the Esaase main zone providing a new
exploration target for Keegan.
-- Settling out-of court with litigants in a concession lawsuit over Esaase
allowing the Company to rapidly move forward with the Esaase Gold
Project without the distraction and perceived risk of litigation and
claims on the Esaase tenements.
On behalf of the Board of Directors,
Peter Breese, President & CEO
About Keegan Resources Inc.
Keegan is a gold development company focussing on near term gold
production at its high grade multi-million ounce Esaase gold project
in Ghana. The Company offers investors the opportunity to share
ownership in the rapid exploration and development of high quality
pure gold assets. Keegan is focused on its wholly owned flagship
Esaase gold project (3.83 million ounces of gold in the Measured and
Indicated category with an average grade of 1.73 g/t Au and 1.25
million ounces of gold in the Inferred category with an average grade
of 1.75 g/t Au, based on a 0.8 g/t Au cut-off) located in Ghana, West
Africa; a highly favourable and prospective jurisdiction. Managed by
highly skilled and successful technical and financial professionals,
Keegan is well financed with no debt. The Company is also strongly
committed to the highest standards for environmental management,
social responsibility, and health and safety for its employees and
Keegan trades on the TSX and the NYSE MKT under the symbol KGN.
For more information about Keegan Resources, visit the website at
Forward-Looking and other Cautionary Information
This release includes certain statements that may be deemed
"forward-looking statements". All statements in this release, other
than statements of historical facts, that address estimated resource
quantities, grades and contained metals, possible future mining,
exploration and development activities, are forward-looking
statements. Although the Company believes the forward-looking
statements are based on reasonable assumptions, such statements
should not be in any way construed as guarantees of future
performance and actual results or developments may differ materially
from those in the forward-looking statements. Factors that could
cause actual results to differ materially from those in
forward-looking statements include market prices for metals, the
conclusions of detailed feasibility and technical analyses, lower
than expected grades and quantities of resources, mining rates and
recovery rates and the lack of availability of necessary capital,
which may not be available to the Company on terms acceptable to it
or at all. The Company is subject to the specific risks inherent in
the mining business as well as general economic and business
conditions. For more information on the Company, Investors should
review the Company's annual Form 20-F filing with the United States
Securities Commission and its home jurisdiction filings that are
available at www.sedar.com.
Neither Toronto Stock Exchange nor the Investment Industry Regulatory
Organization of Canada accepts responsibility for the adequacy or
accuracy of this release.
Keegan Resources Inc.
604-683-8193 or (Toll Free) 1-800-863-8655
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