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Rosia Montana Gold Corporation Cuts Share Face Value To Cover Loss

October 27, 2011

Rosia Montana Gold Corporation (RMGC) will reduce its share capital by 252.7 million lei (EUR 58.39 million), by diminishing the face value of shares, according to Mediafax.

The face value of a RMGC share will be 0.84 lei, instead of 1.43 lei.
The RMGC share capital was thus diminished from RON 612.6 million to RON 359.8 million.

Losses reported by RMGC

In 2009, RMGC reported losses of RON 162.8 million.
In 2010, the losses reported by RMGC were of RON 165.4 million.

RMGC to borrow 2/3 of the value of the investement

On Sept 8th 2011, RMGC technical director Cecilia Szentesy had declared that RMGC was to borrow $700 million from an international bank consortium led by Royal Bank of Canada. This amount would represent two thirds of the value of the investment estimated for the proposed mining project.

A similar mining company declared bankruptcy in 2003, after more than 7 years of local opposition

In 2003, TVX, a mining company who wanted to open a similar project in Greece, declared bankruptcy after many years of trying to persuade the locals to accept the project.


Resources:

[EN] RMGC cuts share face value to cover loss, Mediafax (subscribtion only)
[EN] RMGC to borrow $700m for proposed mining project in Romania, Mediafax (subscribtion only)
[RO] Pierderi pentru Rosia Montana Gold Corporation

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