RENO, Nev., Nov. 28, 2005 (PRIMEZONE) -- Battle Mountain Gold Exploration Corp. (OTCBB:BMGX) ("Battle Mountain" or the "Company") and IAMGOLD Corporation (AMEX:IAG)(TSE:IMG)("IAMGOLD") are pleased to announce the purchase and sale of the IAMGOLD gold royalty assets ("IAMGOLD Assets"). The portfolio of eleven net smelter royalty interests includes operating net smelter royalties from the Williams Mine, Don Mario Mine and El Limon Mine. The purchase price for the portfolio is US$21,850,000 consisting of $15,850,000 in cash and 12,000,000 BMGX shares. Upon the close of the transaction, IAMGOLD will own approximately 15% of the outstanding shares of Battle Mountain.
Battle Mountain's management believes that this important acquisition represents the Company's foundation in building a significant international portfolio of gold assets. Mark Kucher, Battle Mountain's Chairman and CEO, states, "The IAMGOLD royalty portfolio is an excellent mix of current cash flow from the Williams, Don Mario and El Limon mines, near-term production and cash flow from the Dolores, La India, and Relief Canyon deposits and future growth potential from the Seguenega, Marmato and Lluvia de Oro properties. We will complement the portfolio's growth potential with our own exploration program in Nevada and leverage our intellectual capital using the royalty model."
Grant Edey, IAMGOLD's Chief Financial Officer stated, "Although the suite of gold royalties have long represented a stable and growing source of cash flow for us, given the significant expansion in our African mining assets and our focus on mine development and operations, senior management and the Board decided that the gold royalties are more appropriately held within a corporation focused on a royalty business model. We fully endorse Battle Mountain's growth strategy, which is why we are retaining equity as part of the purchase consideration. We look forward to a successful relationship with Battle Mountain."
Battle Mountain's strategy of becoming a significant owner of gold assets will be achieved through a combination of: a) managing the existing portfolio of IAMGOLD royalty assets; b) generating new royalty interests through discovery by further developing our core water chemistry exploration program in Nevada; c) identifying and acquiring existing royalty assets at attractive multiples; and d) where appropriate, financing existing projects that are near completion in exchange for royalty interests. The Company believes that there are a large number of opportunities that remain unexploited. Battle Mountain is in an excellent position to take immediate advantage of these opportunities.
The cash portion of the purchase price will be funded in part by a gold loan facility, structured and provided by Macquarie Bank Limited.
The transaction is expected to close in early 2006.
Battle Mountain management will be hosting a conference call on Tuesday, November 29th, 2005 at 2:00 EST. Dial in number for the call is 1-800-409-5512; the participant access code is 28683.
On behalf of the Board of Directors, Mark Kucher Chairman and CEO
Safe Harbor for Forward-Looking Statements: This release contains certain "forward-looking statements" as defined by the Private Securities Litigation Reform Act of 1995, including, without limitation, expectations, beliefs, plans and objectives regarding the potential transactions and ventures discussed in this release. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are the risks inherent in minerals exploration, the need to obtain additional financing, the availability of needed personnel and equipment for future exploration and development, fluctuations in the price of minerals, and general economic conditions.