NEW YORK, Jan. 13, 2006 (PRIMEZONE) -- Great West Gold, Inc. (OTCBB:GWGO) has been inundated with requests from shareholders regarding its Stock Dividends and future prospects. This announcement is being made to clarify the transactions and to answer all of the numerous shareholder enquiries of late.
Great West Gold, Inc. ("The Company") confirms the various transactions and its future plans, as follows :-
RATIONALE :-
The Company has promised its shareholders that it would create value and has examined countless possibilities. The Company required cash to embark on its mining exploration programme and given the current share structure, this was not possible. The Company elected to admit each of its five wholly owned Gold Mining Exploration on the OTC Pink Sheets Market and distribute the majority of these shares to the Company's shareholders.
The OTC Pink Sheets Market introduced new rules which would have resulted in a very lengthily delay in the admission of these companies to the OTC Pink Sheets Market and the shareholders would have held restricted stock in these companies for a period of one year.
The Company's solution to these problems was to dispose of approximately half of each of the five Gold Mining Exploration Companies shares to five new Holding Companies incorporated in the United Kingdom ("Holding Companies") and to quote these shares in the Holding Companies on an OTC Market in the United Kingdom. The Company continued with its planned distribution of these shares to its shareholders.
This structure classifies the Holding Companies as "Foreign Issuers" thereby permitting these five Holding Companies to immediately seek admittance to the OTC Pink Sheets Market through "Unsolicited Trades". This would be effected immediately after the admittance of these Holding Companies to an OTC Market in the United Kingdom and after the filing of the Financial and Information Statements for each of these five Holding Companies with the OTC Pink Sheets Market.
It is expected that the admission of these companies to an OTC Market in the United Kingdom will be completed on or before January 31, 2006 and that the Companies will have a "dual listing" on the OTC Pink Sheets Market on or before February 15, 2006.
This will allow each company to raise cash to commence mining exploration and to be independent of Great West Gold, Inc. Each of these companies will be appointing independent Directors and experienced Mining Management.
BREAKDOWN OF THE STOCK DIVIDENDS :-
1. BOUSE MINING HOLDINGS PLC ("Bouse")
Bouse holds 98,000,000 shares of Common Stock in Windsor
Resources, Inc. For every 1,000 shares in Great West Gold,
Inc. held at the "Record Date", that being November 7, 2005,
the Company's shareholders will receive an amount of 28.82
Ordinary Shares in Bouse valued at 10p (US$0.18) per share.
This translates into a value of (Pounds)2.88 (US$5.11) for
every 1,000 shares of Great West Gold, Inc. Common Stock held
at the "Record Date".
2. SENTINEL RESOURCE HOLDINGS PLC ("Sentinel")
Sentinel holds 98,000,000 shares of Common Stock in Sentinel
Resources, Inc. For every 1,000 shares in Great West Gold,
Inc. held at the "Record Date", that being November 14,
2005, the Company's shareholders will receive an amount of
19.46 Ordinary Shares in Sentinel valued at 10p (US$0.18) per
share. This translates into a value of (Pounds)1.95 (US$3.46)
for every 1,000 shares of Great West Gold, Inc. Common Stock
held at the "Record Date".
3. COPPERSTONE MINING HOLDINGS PLC ("Copperstone")
Copperstone holds 98,000,000 shares of Common Stock in
Copperstone Mining, Inc. For every 1,000 shares in Great
West Gold, Inc. held at the "Record Date", that being
December 2, 2005, the Company's shareholders will receive an
amount of 19.46 Ordinary Shares in Copperstone valued at 10p
(US$0.18) per share. This translates into a value of
(Pounds)1.95 (US$3.46) for every 1,000 shares of Great West
Gold, Inc. Common Stock held at the "Record Date".
4. AMBASSADOR GOLD HOLDINGS PLC ("Ambassador")
Ambassador holds 98,000,000 shares of Common Stock in
Ambassdaor Gold Mining, Inc. For every 1,000 shares in Great
West Gold, Inc. held at the "Record Date", that being January
2, 2006, the Company's shareholders will receive an amount of
18.86 Ordinary Shares in Ambassador valued at 10p (US$0.18)
per share. This translates into a value of (Pounds)1.89
(US$3.35) for every 1,000 shares of Great West Gold, Inc.
Common Stock held at the "Record Date".
5. GOLDEN EAGLE MINING HOLDINGS PLC ("Golden")
Golden holds 98,000,000 shares of Common Stock in Golden
Eagle, Inc. For every 1,000 shares in Great West Gold, Inc.
held at the "Record Date", that being January 4, 2006, the
Company's shareholders will receive an amount of 18.86
Ordinary Shares in Golden valued at 10p (US$0.18) per
share. This translates into a value of (Pounds)1.89 (US$3.35)
for every 1,000 shares of Great West Gold, Inc. Common Stock
held at the "Record Date".
POSTING OF SHARE CERTFICATES :-
The Transfer Agent to each of the five Holding Companies will post to each shareholder of Record at the various "Record Dates", their share certificates in the Holding Companies. This will be effected upon receipt of the Trading Symbol and CREST Settlement number in the United Kingdom and the ISIN and CUSIP Numbers and Trading Symbol in the USA. The Transfer Agent will obtain the shareholder details for those shareholders who hold their shares in Great West Gold, Inc. in their Stock Brokerage Nominee accounts.
TRADING OF HOLDING COMPANY SHARES :-
These shares are unrestricted and upon receipt of their share certificates, shareholders are free to trade in these five companies.
AMERICAN DEPOSITARY RECEIPTS ("ADR") :-
The Company has elected to create a Level I ADR Programme for each of these five Holding Companies. Each ADR Unit will consist of 1,000 Ordinary Shares in the each of the Holding Companies, thereby creating five ADR Units (one Unit for each of the five Holding Companies). These ADR's are "Foreign Issuers" and will be immediately admitted for trading on the OTC Pink Sheets Market through an "Unsolicited Trade" after the publication of the Financial and Information Statements on the OTC Pink Sheets Market. The effect of these ADR's will be to dramatically reduce the amount of tradable shares ("the free float") in each of these five Holding Companies quoted on an OTC Market in the United Kingdom and on the OTC Pink Sheets Market. Shareholders wishing more information on ADR's should visit www.adr.com and www.adrbny.com.
WEBSITE AND SHAREHOLDER COMMUNICATIONS :-
The Company is at this time updating its website to accurately reflect all of this data and will continue to add all regulatory filings and Press Releases to that website as they are published. Shareholders will be advised on an ongoing basis as to the developments in each of these new Company admissions in the United Kingdom and in the USA. Shareholders will note that our website "Live Person" function has overwhelmed our Investor Relations team and we trust that all of their concerns and questions have been addressed in this announcement.
FILINGS :-
The Company will be filing a detailed Form 8-K on Friday January 13, 2006 detailing all of these Stock Dividends.
BONUS 25% STOCK DIVIDEND :-
The Company is paying a 25% "Bonus" Stock Dividend to its shareholders of "Record", that being January 31, 2006. These "Bonus" Stock Dividend" shares will be electronically credited to shareholder Stock Brokerage accounts on February 6, 2006. Shareholders who hold shares in certificated form will receive their "Bonus" Stock Dividend Share Certificates by post.
WESTERN DIVERSIFIED MINING RESOURCES, INC. ("Western")
The Company owns 71.43% of Western. Western owns the following assets:-
102,000,000 shares of Common Stock in Windsor Resources, Inc., that being the balance not owned by Bouse Mining Holdings plc.
102,000,000 shares of Common Stock in Sentinel Resources, Inc., that being the balance not owned by Sentinel Resource Holdings plc.
102,000,000 shares of Common Stock in Copperstone Mining, Inc., that being the balance not owned by Copperstone Mining Holdings plc.
102,000,000 shares of Common Stock in Ambassador Gold, Inc., that being the balance not owned by Ambassador Gold Holdings plc.
102,000,000 shares of Common Stock in Golden Eagle, Inc., that being the balance not owned by Golden Eagle Mining Holdings plc.
Various quoted shares with a present value of US$1,088,000.
VALUATION OF WESTERN DIVERSIFIED MINING RESOURCES, INC. ("Western):-
Great West Gold, Inc. will sell its entire holding in Western to a new United Kingdom Holding Company in February 2006. This Company will be admitted for trading on an OTC Market in the United Kingdom and then admitted to the OTC Pink Sheets Market as a "Foreign Issuer" through an "Unsolicited Trade". A Level I ADR Programme will be instituted and these Units similarly quoted on the OTC Pink Sheets Market.
The valuation of these assets is as follows :-
The shareholdings in Windsor Resources, Inc. will be disposed of to Bouse Mining Holdings plc ("Bouse") in return for 102,000,000 Ordinary Shares in Bouse. The valuation hereof is (Pounds)10,200,000 (US$18,000,000). Western's share being in the amount of US$12,857,000.
The shareholdings in Sentinel Resources, Inc. will be disposed of to Sentinel Resource Holdings plc ("Sentinel") in return for 102,000,000 Ordinary Shares in Sentinel. The valuation hereof is (Pounds)10,200,000 (US$18,000,000). Western's share being in the amount of US$12,857,000.
The shareholdings in Copperstone Mining, Inc. will be disposed of to Copperstone Mining Holdings plc ("Copperstone") in return for 102,000,000 Ordinary Shares in Copperstone. The valuation hereof is (Pounds)10,200,000 (US$18,000,000). Western's share being in the amount of US$12,857,000.
The shareholdings in Ambassador Gold, Inc. will be disposed of to Ambassador Gold Holdings plc ("Ambassador") in return for 102,000,000 Ordinary Shares in Ambassador. The valuation hereof is (Pounds)10,200,000 (US$18,000,000). Western's share being in the amount of US$12,857,000.
The shareholdings in Golden Eagle, Inc. will be disposed of to Golden Eagle Mining Holdings plc ("Golden") in return for 102,000,000 Ordinary Shares in Golden. The valuation hereof is (Pounds)10,200,000 (US$18,000,000). Western's share being in the amount of US$12,857,000.
These shares in the new United Kingdom Holding Company will be distributed to Great West Gold, Inc. in and during February 2006. This Holding Company will have an asset value in the amount of US$90,777,158, based upon the above-mentioned calculations and factoring in other minor assets. This will result in shareholders holding shares in a minor "Mining House".
CASH RAISING AND MINING EXPLORATION :-
These companies, once quoted on the United Kingdom and on the OTC Pink Sheets Market will be in a strong position to immediately raise the required cash to commence further exploration. All of these Mining Claims have had extensive historical geological work and exploration performed and the Company remains very positive that given the required cash, these companies will, perform extremely well for shareholders. St James Capital Holdings, Inc. has subscribed for shares in each of these companies for amount of (Pounds)100,000 (US$175,000) per company.
MANAGEMENT COMMENTARY :-
The Management of Great West Gold, Inc. has realized that the Company has been consistently attacked by professional "Naked Short Sellers" coupled with an unauthorized quotation on the Berlin Bremen Bourse. Richard Axtell, the President of the Company, confirmed that, "These attacks have been extended to "Paid Bashers" on various stock chat forums and disinformation being disseminated to shareholders in order to encourage selling by these shareholders allowing these criminals to gain from their continual illegal shorting on the company's Stock. This is no longer of interest to Management given the "dismemberment" of the Company which result in these criminals being "caught very short" in their trading positions, a situation which is very likely to cost these "Naked Short Sellers" tens of millions of dollars in a very short period of time. The preposterous notion that the Company has no assets is a blatant lie given the published reports on certain of the Company's assets and valuations signed by eminent Geologists."
Despite these attacks, Management has managed to create enormous value for its shareholders and more importantly has honoured its promises to shareholders. Shareholders who are concerned about the existing ridiculously undervalued stock price will now be rewarded and the criminals ("Naked Short Sellers") punished.
LOAN NOTE HOLDER :-
St James Capital Holdings, Inc. ("St James") (www.stjcapital.com) holds a Loan Note from Great West Gold, Inc. in the amount of US$1,750,000. St James has agreed not to convert the Loan Note into shares of Common Stock in the Company until the acquisition (as below-mentioned) is concluded.
ACQUISITION :-
Upon the completion of these various transactions as above-mentioned, the company will simultaneously distribute its shareholding in the new United Kingdom Holding Company of Western Diversified Mining Resources, Inc. and will acquire a group of companies in a different Industry Sector. This allows shareholders to participate in yet another venture apart from their shareholdings in the six new Holding Companies. This will occur in and during February 2006 and will result in an ISIN, CUSIP Number, Trading Symbol and Company Name change.
Statements contained in this press release, which are not historical facts, are forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based largely on the Company's expectations and are subject to a number of risks and uncertainties beyond the Company's control, including but not limited to economic, competitive and other factors affecting the Company's operations, management team effectiveness, expansion strategies, available financing, market prices and recovery costs, government regulations involving the Company, facts and events not known at the time of this release, and other factors discussed in the Company's filings with the Securities and Exchange Commission. These statements are not guarantees of future performance and readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. The Company undertakes no obligation to update publicly any forward-looking statements.
The Great West Gold, Inc. company logo is available at: http://www.primezone.com/newsroom/prs/?pkgid=2223