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Re: 2008 - Tuesday, June 10, 2008
Eldorado Issues Proxy Circular Soliciting Blue Proxies To Vote
Against Approval Of Frontier's Poison Pill -- ISS Canada Also
Recommends That Shareholders Vote Against Approval Of Frontier's
Poison Pill
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VANCOUVER, BC -- Paul N. Wright, President and Chief Executive Officer
of Eldorado Gold Corporation ("Eldorado") announced today that Eldorado
has mailed to shareholders of Frontier Pacific Mining Corporation
("Frontier") and filed on SEDAR, an information circular and BLUE form
of proxy (the "Circular and Proxy") relating to a general meeting of
Frontier shareholders to be held on June 19, 2008 (the "Meeting").
Frontier management have called the Meeting in order to adopt and
confirm a "tactical" shareholder rights plan -- more commonly referred
to as a "Poison Pill"-- adopted by Frontier on May 16, 2008 in direct
response to the offer (the "Offer") by Eldorado to purchase all of the
issued and outstanding common shares of Frontier.
Eldorado believes that Frontier's Poison Pill does not enhance
shareholder value and serves no purpose other than to entrench
Frontier's current management and to deny Frontier's shareholders the
opportunity to tender to a fair and full Offer at an attractive
premium. Accordingly, Eldorado has sent the Circular and Proxy to
Frontier shareholders to solicit votes against approval and
confirmation of the Poison Pill.
Frontier has stated that its principal reason for adopting the Poison
Pill is to provide Frontier's management with the time required to find
an alternative transaction to the Offer. However, as of the June 17,
2008 expiry date of Eldorado's Offer, Frontier's management will have
had 60 days to find alternative transactions since the time they
learned of Eldorado's current Offer and nearly two years since Eldorado
first approached Frontier to propose a business combination. Eldorado
believes that Frontier's management has had ample time to find
alternatives to the Offer, and notes that they have thus far failed to
present a single one.
Eldorado also notes that Institutional Shareholder Services Canada
Corp. ("ISS Canada") has recommended that Frontier shareholders vote
against approval and confirmation of the Poison Pill. In a report
published on June 3, 2008, ISS Canada stated that the Poison Pill,
"provides the board and management with excessive opportunity to
interpret provisions of the plan. This plan does not allow
shareholders enough control of the process to sufficiently safeguard
their interests". ISS Canada is a wholly-owned subsidiary of
Institutional Shareholder Services Inc. ("ISS"). ISS is one of the
world's leading providers of corporate governance and proxy voting
solutions. It provides proxy research, voting services and corporate
governance advisory services to financial institutions and corporations
worldwide.*
Eldorado's President and Chief Executive Officer, Paul N. Wright,
commented, "We are pleased with the ISS Canada recommendation. It
validates Eldorado's position that this Poison Pill does not advance
the interests of Frontier's shareholders and should be voted down."
If Frontier's Poison Pill is not waived, voted down or otherwise
terminated prior to the time of expiry of Eldorado's Offer, the Offer
will terminate in accordance with its terms. Therefore, Frontier
shareholders who tender to Eldorado's Offer must also vote against
Frontier's Poison Pill.
Eldorado urges Frontier shareholders to seriously consider the risks
and uncertainties Frontier will face if the Poison Pill is approved and
Eldorado's Offer expires, including the prospect of a collapse of
Frontier's current share price to pre-offer prices. Prior to
Eldorado's announcement that it intended to make the Offer, the 20-day
volume weighted average price for Frontier shares on the TSX Venture
Exchange was C$0.668 per share. Since Eldorado announced its intention
to make the Offer, Frontier's share price has increased substantially
and has since traded at higher levels supported by Eldorado's Offer.
Based on the closing price of Eldorado's common shares on the Toronto
Stock Exchange on June 9, 2008, the Offer now represents a premium of
53.0% to the price of Frontier shares on the TSX Venture Exchange on
April 18, 2008, the last trading day prior to the announcement of the
Offer.
Eldorado's Offer remains open for acceptance until 5:00 p.m. (Toronto
time) on June 17, 2008, unless extended or withdrawn. Frontier
shareholders wishing to accept the Offer are encouraged to tender their
shares by completing the letter of transmittal accompanying the
documents mailed to them and returning it together with certificates
representing their Frontier shares and all other documents to the
offices of Kingsdale Shareholder Services Inc. in Toronto, Ontario in
accordance with the instructions in the letter of transmittal. If
Frontier shares are held by a broker or other financial intermediary,
Frontier shareholders should contact such intermediary and instruct it
to tender their Frontier shares.
Proxy Voting
Frontier shareholders are reminded to vote the BLUE proxy and to return
it to Kingsdale Shareholder Services Inc. in accordance with the
instructions set out in the Circular and Proxy, by no later than
Monday, June 16, 2008.
This press release does not constitute an offer to buy or an invitation
to sell, or the solicitation of an offer to buy or invitation to sell,
any of the securities of Eldorado or Frontier. Such an offer may only
be made pursuant to an offer and take-over bid circular filed with the
securities regulatory authorities in Canada.
Eldorado has filed the Circular and Proxy with the United States
Securities and Exchange Commission (the "SEC"). Eldorado has also
filed with the SEC a Registration Statement, which includes the offer
and take-over bid circular, prospectus and notice of change in
information relating to its offer to Frontier shareholders. ELDORADO
URGES INVESTORS AND SECURITY HOLDERS TO READ THE REGISTRATION
STATEMENT, THE OFFER AND TAKE OVER BID CIRCULAR, THE NOTICE OF CHANGE
IN INFORMATION AND ANY OTHER RELEVANT DOCUMENTS TO BE FILED WITH THE
SEC AND CANADIAN SECURITIES REGULATORY AUTHORITIES, BECAUSE THEY
CONTAIN IMPORTANT INFORMATION. Investors may obtain a free copy of the
offer and take-over bid circular and other documents filed by Eldorado
with the Canadian securities regulators at www.sedar.com and with the
SEC at the SEC's website at www.sec.gov. The offer and take-over bid
circular and other documents may also be obtained for free, from
Eldorado's website or by directing a request to Eldorado's investor
relations department by telephone at 1-888-353-8166, fax 604-687-4026
or e-mail info@eldoradogold.com or by contacting the Information Agent,
Kingsdale Shareholder Services Inc., toll free at 1-866-879-7649.
About Eldorado
Eldorado is a gold producing, exploration and development company
actively growing businesses in Brazil, Turkey, China and the
surrounding regions. With our international expertise in mining,
finance and project development, together with highly skilled and
dedicated staff, we believe that Eldorado is well positioned to grow in
value as we create and pursue new opportunities.
ON BEHALF OF
ELDORADO GOLD CORPORATION
Paul N. Wright
Paul N. Wright,
President & Chief Executive Officer
Certain of the statements made herein may contain forward-looking
statements or information within the meaning of the United States
Private Securities Litigation Reform Act of 1995, and forward-looking
statements or information within the meaning of the Securities Act
(Ontario). Such forward looking statements or information include, but
are not limited to statements or information with respect to unknown
risks, uncertainties and other factors which may cause the actual
results, performance or achievements of Frontier or Eldorado, or
industry results, to be materially different from any future results,
performance or achievements expressed or implied by such
forward-looking statements. Forward-looking statements or information
are subject to a variety of risks and uncertainties, which could cause
actual events, or results to differ from those reflected in the
forward-looking statements or information. Should one or more of these
risks and uncertainties materialize, or should underlying assumptions
prove incorrect, actual results may vary materially from those
described in forward looking statements. Specific reference is made to
"Forward Looking Statements and Risk Factors" in Eldorado's Annual
Information Form and Form 40 F dated March 31, 2008. Forward-looking
statements herein include statements regarding the expectations and
beliefs of management and the possible impact of a termination of
Eldorado's Offer on the price of Frontier Shares. Such factors
included, amongst others, the following: gold price volatility; impact
of any hedging activities, including margin limits and margin calls;
discrepancies between actual and estimated production, between actual
and estimated reserves, and between actual and estimated metallurgical
recoveries; mining operational risk; regulatory restrictions, including
environmental regulatory restrictions and liability; risks of sovereign
investment; speculative nature of gold exploration; dilution;
competition; loss of key employees; additional funding requirements;
and defective title to mineral claims or property, as well as those
factors discussed in the section entitled "Risk Factors" in Eldorado's
Annual Information Form and Form 40-F dated March 31, 2008. We do not
expect to update forward-looking statements continually as conditions
change and you are referred to the full discussion of Eldorado's
business contained in Eldorado's reports filed with the securities
regulatory authorities in Canada and the U.S.
*Permission to quote the ISS Canada report was neither sought nor
obtained.
Eldorado Corporation shares trade on the Toronto Stock Exchange (TSX:
ELD) and the American Stock Exchange (AMEX: EGO). The TSX has neither
approved nor disapproved the form or content of this release.
Contact:
Nancy E. Woo, Manager Investor Relations
Phone: 604.601.6650 or 1.888.353.8166
Fax: 604.687.4026
Email: nancyw@eldoradogold.com
Request for information packages: laurelw@eldoradogold.com
Eldorado Gold Corporation
1188, 550 Burrard Street
Vancouver, BC V6C 2B5
Web site: www.eldoradogold.com
View News Release or First Quarter Report in PDF Format:
Associated File:
http://www.eldoradogold.com/i/pdf/08-13.pdf
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Copyright (c) 2008 ELDORADO GOLD CORP. (ELD) All rights reserved. For
more information visit our website at http://www.eldoradogold.com/ or
send mailto:info@eldoradogold.com
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