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Press release from CNW Group

Gran Colombia Gold Announces Closing of US$100 Million Financing to Invest in Colombia to Increase Gold Production and Reduce Cash Costs at Segovia Operations

Tuesday, October 30, 2012

Gran Colombia Gold Announces Closing of US$100 Million Financing to Invest in Colombia to Increase Gold Production and Reduce Cash Costs at Segovia Operations10:50 EDT Tuesday, October 30, 2012/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/TORONTO, Oct. 30, 2012 /CNW/ - Gran Colombia Gold Corp. (TSX: GCM) (the "Company") announced today that it has closed the previously priced offering (see Company press release dated October 22, 2012) of US$100 million aggregate principle amount of units. Each unit of the offering consists of one US$1,000 face amount secured, 10% gold-linked note and 250 common share purchase warrants.The net proceeds of the offering will be used as project financing for the Pampa Verde Project at the Company's Segovia Operations in Colombia, which includes the construction of a 2,500 tpd mill, the development of a new mechanized underground mine to access new vein deposits as well as improve access to the existing mines, additional capital expenditures relating to the Pampa Verde Project and interest payments on the notes. The Company also intends to arrange lease financing for a portion of the equipment required for the Pampa Verde Project.The offering was conducted by a syndicate of agents led by GMP Securities L.P., as sole lead agent and sole book-runner, and included Stifel Nicolaus Canada Inc.The units, the notes, the warrants and the warrant shares have not been, and will not be, registered under the United States Securities Act of 1933, as amended (the "Securities Act"), or any state securities laws and, unless so registered, may not be offered or sold in the United States or to U.S. persons except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws, nor has the Company filed, and the Company will not file, a prospectus in any jurisdiction in Canada. The units, the notes, the warrants and the warrant shares have been offered only to (i) qualified institutional buyers and (ii) a limited number of "accredited investors" within the meaning of Rule 501(a) under the U.S. Securities Act, pursuant to the exemption from the registration requirements under the U.S. Securities Act provided by Rule 144A and Rule 506 of Regulation D thereunder, respectively, and outside the United States to non-U.S. persons under Regulation S. The Units, the notes and the warrants have been offered and sold in Canada on a basis which is exempt from the prospectus requirements of applicable Canadian securities laws.This news release shall not constitute an offer to sell or the solicitation of an offer to buy any units, notes, warrants or warrant shares, nor shall there be any offer or sale of any units, notes, warrants or warrant shares in any jurisdiction in which such offer, solicitation or sale would be unlawful.About Gran Colombia GoldGran Colombia is a Canadian-based gold and silver exploration, development and production company with its primary focus in Colombia. Gran Colombia is currently the largest underground gold and silver producer in Colombia with several underground mines in operation at its Segovia and Marmato Operations. In addition, Gran Colombia is advancing a project to develop a large-scale, gold and silver mine at its Marmato Operations.Additional information on Gran Colombia Gold can be found on the Company's website at www.grancolombiagold.com and by reviewing the Company's page on SEDAR at www.sedar.com.This news release contains "forward-looking information", which may include, but is not limited to, statements with respect to the future financial or operating performance of the Company and its projects and, specifically, statements concerning anticipated growth in annual gold production and reduction of cash costs. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", or "believes" or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Gran Colombia to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Factors that could cause actual results to differ materially from those anticipated in these forward-looking statements are described under the caption "Risk Factors" in the Company's Annual Information Form dated as of March 28, 2012 which is available for view on SEDAR at www.sedar.com. Forward-looking statements contained herein are made as of the date of this press release and Gran Colombia disclaims, other than as required by law, any obligation to update any forward-looking statements whether as a result of new information, results, future events, circumstances, or if management's estimates or opinions should change, or otherwise. There can be 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. Accordingly, the reader is cautioned not to place undue reliance on forward-looking statements.SOURCE: Gran Colombia Gold Corp.For further information: Roy MacDonald VP Investor Relations investorrelations@grancolombiagold.com (416) 360-4653