RE: RE: RE: RE: Vatukoula shares and CZN
Vancouver, British Columbia, September 29, 2009 - Canadian Zinc Corporation (TSX: CZN;
OTCBB: CZICF) reports that it has conditionally agreed to subscribe for 125 million new
shares in Vatukoula Gold Mines plc (“VGM”) for an investment of £1.5 million (1.2 pence per
share).
Canadian Zinc’s subscription is part of a share placement by VGM to raise approximately £9
million (Cdn $15.75 million). Sprott Asset Management Inc., a substantial shareholder of
both VGM and CZN has also subscribed for 124.5 million shares of VGM for an investment of
£1.5 million.
Canadian Zinc also reports that Viso Gero Global Inc. has exercised its previously
announced call option and has purchased from Canadian Zinc 200 million shares of VGM for
£2 million.
In a separate transaction, Canadian Zinc has exercised its right, upon exercise of the Viso
Gero call option, to acquire further shares of VGM and has agreed with VGM to subscribe £2
million for 156 million new shares (1.28 pence per share).
Following completion of the VGM financing and CZN’s separate subscription, Canadian Zinc
will hold 628 million shares of VGM representing approximately 17.2% of VGM’s then
outstanding shares.
The net placing proceeds will be used by VGM to assist in increasing its’ pro rata annual
production to in excess of 100,000 ounces by the beginning of the 2011 calendar year. This
is expected to be achieved via an increased underground capital development program,
allowing access to increased mining faces, increasing both the capacity of tonnage delivered
from underground and an increase in delivered grade to the mill. While VGM is confident of
reaching its stated objectives there can be no guarantee that they will be achieved.
Vatukoula Gold Mines plc is a UK company, listed on the AIM Market of the London Stock
Exchange, which currently owns and operates the Vatukoula Gold Mine located in Fiji.
1Tuvatu Option cancelled
Canadian Zinc also reports that it has agreed to cancel its option on the Tuvatu Gold Proje