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Press release from CNW Group

Endeavour Mining announces filing of information circular and receipt of Australian FIRB Approval

Friday, October 28, 2011

Endeavour Mining announces filing of information circular and receipt of Australian FIRB Approval13:40 EDT Friday, October 28, 2011Toronto Stock Exchange: EDVGEORGE TOWN, Grand Cayman, Oct. 28, 2011 /CNW/ - Endeavour Mining Corporation ("Endeavour" or the "Corporation") (TSX:EDV) is pleased to announce that it has filed and mailed its management information circular (the "Information Circular") dated October 17, 2011 for the upcoming special meeting (the "Meeting") at which Endeavour's shareholders ("Shareholders") will be asked to consider and vote upon the issuance of Endeavour shares in connection with the previously announced merger by way of scheme of arrangement ("Merger") which, if approved, will result in the business combination of Endeavour and Adamus Resources Limited ("Adamus") (ASX:ADU).Endeavour has also received formal notification from the Treasurer of the Commonwealth of Australia under the Foreign Acquisitions and Takeovers Act 1975 (Commonwealth of Australia) that the Treasurer does not object to Endeavour acquiring up to 100% of Adamus ("FIRB Approval").  Receipt of FIRB Approval satisfies one of the key conditions of the Merger.Neil Woodyer, CEO, commented "We are pleased to have reached these milestones.  The merger combines two junior gold producers and creates a platform for West African growth. The merged entity has a strong production growth profile, excellent exploration potential and a focused acquisition strategy.  It will have the management and financial strength to carry out its plans.  On the Adamus side of the merger, the Scheme Booklet was dispatched by Adamus to its shareholders on October 25, 2011, and the Merger is on schedule to close during December 2011."The Endeavour Meeting is scheduled to be held on Friday, November 25, 2011 at 9am (Monaco time) and the record date for determining the Shareholders entitled to receive notice of and vote at the Meeting was October 17, 2011.  Further details are set forth in the Notice of Meeting that is included with the Information Circular.  The Adamus shareholders' meeting is scheduled to be held on Monday, November 28, 2011 at 10am (Perth time).Endeavour has commenced mailing of the Meeting Materials to Shareholders.  Copies of the Meeting Materials are also available electronically on SEDAR ( and on Endeavour's website ( discussed in the Information Circular, in reaching its decision to approve the Merger, Endeavour's board of directors considered the positive results of the due diligence review conducted by Endeavour's management and its advisors, as well as the benefits of creating a merged entity with the following attributes:Gold Production.  The merged entity is expected to have strong cash generation from two operating gold mines, the Youga Gold Mine ("Youga") in Burkina Faso and Adamus' Nzema Gold Mine ("Nzema") in Ghana, with a combined current annual production rate of approximately 185,000 ounces at a cash cost (excluding royalties) of approximately US$600 per ounce.  Nzema was commissioned with a 1 million ounce mineral reserve, commenced commercial production on April 1, 2011 and is currently producing approximately 100,000 ounces of gold per year.Near-Term Production Growth.  Gold production is expected to increase to approximately 250,000 ounces per year from the end of 2013 from existing properties, assuming a positive decision in the first quarter of 2012 to construct a mine at the Agbaou Project in Côte d'Ivoire.Resource and Reserve Base.  Attributable measured and indicated resources of approximately 3.5 million ounces, which include attributable proven and probable reserves of approximately 2.0 million ounces, as at December 31, 2010.  The merged entity would have additional attributable inferred resources of 1.2 million ounces.  See "Mineral Resources and Reserves" below.Pipeline for West African Exploration and Development Growth. An extensive exploration land package in highly prospective regions of Ghana, Burkina Faso, Côte d'Ivoire, Liberia and Mali covers over 10,000 km2, and provides an organic project pipeline driven by active exploration and development programs (expected budget of approximately US$40 million for 2012).Integration of Complementary Management Teams. The merged entity will benefit from the complementary skills and experience of the respective management teams.  In particular, Adamus' construction expertise from the successful commissioning of the Nzema mine can be applied to the construction of a mine at Agbaou.Increasing Leverage to Gold. In connection with its financing, Nzema has a remaining gold hedging program of approximately 265,000 ounces at a fixed price of US$1,075. Endeavour intends to reduce these hedging volumes by approximately 50% (assuming current gold prices) with an investment of up to US$100 million, thereby creating greater leverage to the gold price. This investment is expected to translate into stronger operating cashflow and EBITDA.Financial Strength. The merged entity is expected to have a strong financial profile, with an opening cash and marketable securities position of over US$200 million, operating cashflow from two mines (2012 cash margin of approximately US$165 million1, based on a spot gold price of US$1,600/oz) and access to a credit approved US$200 million four-year revolving corporate loan facility from UniCredit Bank AG (to be used for general corporate purposes, capital expenditure and acquisitions).2  Endeavour anticipates additional cash proceeds of up to approximately C$100 million from options and warrants having an exercise price of C$2.50 or less.Acquisition Strategy. The acquisition strategy is focused on West Africa and targets the acquisition of additional mine production by the end of 2013. The expanded gold business is expected to be well-positioned to take advantage of acquisition opportunities that are unavailable to the individual companies today.Enhanced Capital Markets Profile. The integration of the companies' diversified mining assets, its development plan and a combined market capitalization of approximately US$600 million (pro forma at the merger announcement date), with listings on both the TSX and ASX, provides access to a wider group of investors as well as potentially better trading liquidity and increased analyst coverage.For further information or assistance in voting your shares or to request additional copies of the Meeting Materials, Shareholders should contact Kingsdale Shareholder Services Inc., at 1-866-581-1571 toll free in North America or collect at 416-867-2272 outside of North America or by email at Resources and ReservesThe mineral reserves and resources of the merged entity, as at December 31 2010, are set out in Tables 1 and 2.Table 1 - Merged Entity mineral reserves by classificationCompanyProvenOuncesProbableOuncesProven & ProbableOuncesEndeavour (attributable)238,040804,5201,042,560Adamus (attributable)768,000193,000961,000Merged Entity (attributable)1,006,040997,5202,003,560Table 2 - Merged Entity mineral resources by classificationCompanyMeasuredOuncesIndicatedOuncesMeasured & IndicatedOuncesInferredOuncesEndeavour (attributable)369,5001,549,2501,918,750890,700Adamus (attributable)1,081,800496,8001,575,000325,800Merged Entity (attributable)1,451,3002,046,0503,493,7501,216,500The information in these tables is derived from the technical reports of Endeavour and Adamus filed under their respective profiles at PersonsWith respect to technical information relating to mineral projects on properties material to the merged entity contained in this news release, Adrian de Freitas, C. Eng., General Manager, Youga Mine, K. Kirk Woodman, P.Geo., Endeavour's Head of Exploration, and Martin Bennett, Adamus' General Manager, Exploration and Business Development, have approved such disclosure as "qualified persons" for the purposes of NI 43-101.About Endeavour Mining CorporationEndeavour is a gold producer.  Endeavour also holds an extensive exploration land position and various advanced-stage development gold projects in West Africa.  Endeavour has a global strategy, supported by financial resources and management's company building expertise, to grow into an intermediate gold producer through strategic acquisitions.On August 21, 2011, Endeavour and Adamus Resources Limited (ASX:ADU) announced they have entered into a definitive Merger Implementation Agreement to combine through an all-stock merger of equals transaction creating a new growth focused West African gold producer. The merger is scheduled to close during December 2011.The common shares of Endeavour Mining Corporation are traded on the Toronto Stock Exchange under the symbol "EDV".On behalf of Endeavour Mining Corporation"Neil Woodyer"Neil WoodyerChief Executive OfficerThe Toronto Stock Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release. The foregoing information may contain forward-looking information relating to the future performance of Endeavour Mining Corporation. Forward-looking information, specifically, that concerning future performance, is subject to certain risks and uncertainties, and actual results may differ materially. These risks and uncertainties are detailed from time to time in the Corporation's filings with the appropriate securities commissions.STATEMENTS REGARDING FORWARD-LOOKING INFORMATION IN THE INFORMATION CIRCULARThe Information Circular, the pro forma financial statements of Endeavour and certain of the material incorporated by reference into the Information Circular contain "forward-looking information" within the meaning of Canadian securities legislation and "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 (collectively, "forward-looking statements").  These forward-looking statements are made as of the date of the document or as of the date of the document from which they are incorporated by reference.Forward-looking statements relate to future events or future performance and reflect Endeavour and Adamus managements' expectations or beliefs regarding future events and include, but are not limited to, statements with respect to the timing and implementation of the proposed Merger, the expected benefits of the Merger considered by the Endeavour Board in making its recommendation that Endeavour Shareholders vote in favour of the Share Issuance Resolution, the integration of Endeavour and Adamus following the Merger, estimation of mineral reserves and mineral resources, availability of cash flow to fund capital requirements, the timing and amount of estimated future production, availability of project financing, and success of mining and development operations.  Assumptions upon which such forward-looking statements are based include that Endeavour and Adamus will be able to satisfy the conditions in the Merger Implementation Agreement, that the required approvals will be obtained from the shareholders of each of Endeavour and Adamus, that all third party, court, regulatory and governmental approvals to the Merger will be obtained, tax treatment of the Merger and that all other conditions to completion of the Merger will be satisfied or waived. Many of these assumptions are based on factors and events that are not within the control of Endeavour or Adamus and there is no assurance they will prove to be correct.In certain cases, forward-looking statements can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "budget", "potential", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or statements that certain actions, events or results "will", "may", "could", "would", "might" or "will be taken", "occur" or "be achieved" or the negative of these terms or comparable terminology.  By their very nature forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Endeavour and Adamus to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include, among others: failure to complete the Merger could negatively impact the market price for Endeavour Shares and future business and financial results; the conditions to the Merger not being satisfied, in which case the Merger would not be completed; a "market overhang" could adversely affect the market price of Endeavour Shares after completion of the Merger; risks related to the integration of Endeavour's and Adamus' businesses, including integration of their respective management teams and board members; capital requirements and operating risks associated with the expanded operations of the Merged Entity and its expanded portfolio of growth projects; risks associated with foreign disclosure standards that Adamus is subject to; risks associated with aggregating the individual risks affecting Adamus and Endeavour separately; risks related to foreign investment; risks related to requiring additional capital requirements; mineral resource estimates may prove to be inaccurate; Endeavour may not realize any of the benefits of its growth projects, including their ability to generate revenue; risks related to operating in jurisdictions which are new to Endeavour, including regulatory risks affecting Adamus' properties which Endeavour Shareholders will assume after the Merger; risks related to actual results of current exploration and development activities; changes in project parameters as plans continue to be refined; future prices of metals; possible variations in mineral reserves, grade or recovery rates; accidents, labour disputes and other risks of the mining industry; delays in obtaining governmental approvals or financing or in the completion of development or construction activities; as well as those factors detailed from time to time in Endeavour's and Adamus' interim and annual financial statements and management's discussion and analysis of those statements, all of which are filed and available for review on their respective profiles on SEDAR at  Although each of Endeavour and Adamus has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended.  Endeavour and Adamus provide no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements.  Endeavour and Adamus do not intend, and do not assume any obligation, to update any forward-looking statements, other than as required by applicable law.  Accordingly, readers should not place undue reliance on forward-looking statements.________________________________1 Assumes $1,600 gold price, 185,000 ounces produced at $600/oz cash cost, 5% government royalties, and 10,000 ounces hedged at $1,075/oz remaining for 2012 after planned hedge reductions.  Actual hedge reductions may vary depending on future market environment.2 Availability of this facility is subject to the implementation of the Merger, execution of the final facility agreements and satisfaction of the facility's conditions.For further information: Stephen Roberts, Senior Vice President - Investor Relations (604) 609-6130, or Vanguard Shareholder Solutions 1-866-341-4111 or (604) 608-0824,