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New Dawn completing administrative filings in Zimbabwe after Central African Gold investment

Published: 18:27 15 Jul 2010 BST

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New Dawn Mining (TSX:ND) is working with the Zimbabwe government to finalise the administrative details surrounding its recent investment in Central African Gold (LON:CAN). The company said that its Zimbabwe-based subsidiary has completed a series of meetings with various Zimbabwe government authorities, and it is currently engaging in discussions and compiling documentation for submission to the Zimbabwe Competition and Tariffs Commission. 

In June, the company acquired an 89% controlling stake in CAG through deals with the company’s three largest shareholders - Emerging Capital Partners (50.02%), HBD Zim Investments Ltd (28.18%) and Investec Asset Management (10.48%).

At the time, New Dawn said that the investment represents a substantial increase in its gold mining business, as well as a focus on, and commitment to, the Zimbabwe gold mining industry.

In today’s statement, the company noted that the submissions are being made in accordance with the Competition Act of Zimbabwe, which requires that a company submits various documents within 30 days of a defined transaction. Also under the terms of the act, the Competition and Tariffs Commission may review whether a transaction is or will be contrary to the public interest in Zimbabwe, in which case it has broad powers to require changes to satisfy any public interest concerns. 

New Dawn is a Zimbabwe-focused junior gold company, which is currently expanding production at its Turk and Angelus mines. The company’s objective is to become a mid-tier gold producer, and 'in-country consolidator' of gold mining assets in Zimbabwe, and with this investment it believes it has taken a major step towards realizing this objective.

In June New Dawn stated that “through this transaction, New Dawn is increasing its gold resource base and associated mining capability to support a consolidated annualized production of 50,000 - 60,000oz of gold within the next 18 to 24 months, followed by an increase to 100,000oz of gold within 4 - 5 years”.

Furthermore, the company said that its ultimate goal is reaching annualized production of 200,000 - 250,000oz of gold.

CAG, through its subsidiary, has interests in two separate Zimbabwe-operating gold mining companies. It owns an 84.7% interest in a Zimbabwe Stock Exchange listed  Falcon Gold Zimbabwe (ZIM:FALGOLD) (Falgold),  and the entire share capital of a private Zimbabwe company  Olympus Gold Mines Ltd.

Through these holdings, CAG has interests in several gold mining properties in Zimbabwe, the most significant properties being: the The Dalny Mine (Falgold); The Golden Quarry Mine (Falgold); The Venice Mine (Falgold); The Camperdown Mine (Olympus); and the The Old Nic Mine (Olympus).

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