Timmins Gold Files Registration Statement to
Provide Capital Gold Stockholders a Direct Voice in the Proposed Merger of
Equals with Timmins
VANCOUVER, B.C. -
Timmins Gold Corp. (TSX-V:TMM) ("Timmins Gold") announces that on February
10, 2011 it filed a preliminary registration statement with the Securities
and Exchange Commission (the "SEC") in respect of its exchange
offer to acquire all of the outstanding shares of common stock of Capital
Gold Corporation ("Capital Gold"). Under the terms of the
exchange offer, Capital Gold stockholders would receive 2.27 Timmins Gold
common shares for each share of Capital Gold common stock. Based on the
average of the respective closing share prices for the last 30 trading
days, the exchange offer has a value of US$5.52 per Capital Gold share and
exceeds the value of Gammon Gold's offer by US$0.61 per Capital Gold share.
The exchange offer has not yet commenced in the United States or in Canada
and will not commence until Timmins Gold mails the related prospectus/offer
to exchange and letter of transmittal to Capital Gold stockholders.
Timmins Gold has also filed a preliminary consent solicitation statement
with the SEC pursuant to which Timmins Gold seeks to remove and replace
Capital Gold's current board of directors with independent directors, each
of whom is unaffiliated with Timmins Gold. Provisions of Delaware corporate
law may preclude the exchange offer from being completed without approval
of Capital Gold's board and, therefore, Timmins Gold believes the consent
solicitation is necessary to provide Capital Gold stockholders with a voice
in the proposed merger of equals with Timmins Gold. Each of the nominees is
committed to acting in the best interests of Capital Gold stockholders and
will take an independent view with respect to Timmins Gold's merger of
equals proposal, the proposed sale of Capital Gold to Gammon Gold and all
other matters.
Timmins Gold has also filed a preliminary proxy statement with the SEC in
connection with Capital Gold's special meeting of stockholders scheduled
for March 18, 2011. The preliminary proxy statement urges Capital Gold
stockholders to oppose the sale of Capital Gold to Gammon Gold and asks
Capital Gold stockholders to vote "AGAINST" all of Capital Gold's
proposals in connection with the Gammon transaction.
Bruce Bragagnolo, Chief Executive Officer of
Timmins Gold, said: "Despite our repeated attempts to conclude a
friendly merger, Capital Gold has decided to cease all discussions with us,
which has left us no choice but to take our offer directly to Capital Gold
stockholders." Mr. Bragagnolo added,
"We believe Capital Gold stockholders deserve the right to choose our
superior offer over the Gammon transaction, and our exchange offer,
together with our proxy solicitation and consent solicitation, gives them
that opportunity."
Capital Gold stockholders who have questions or need assistance should
contact Timmins Gold's proxy solicitor and information agent, Innisfree M&A Incorporated, toll-free at (877)
800-5182; banks and brokers should call: (212) 750-5833.
About Timmins Gold
Focused in Mexico, Timmins Gold Corp. became a gold producer in April 2010
with the commencement of commercial production at its wholly owned San
Francisco Mine in Sonora, Mexico. In addition, the Company has an extensive
portfolio of gold projects in Mexico.
Important Information
This press release does not constitute an offer to sell or the solicitation
of an offer to buy any securities or a solicitation of any vote or
approval. This press release relates to a business combination transaction
with Capital Gold proposed by Timmins Gold. This material is not a
substitute for the prospectus/offer to exchange Timmins Gold has filed with
the SEC regarding the exchange offer and will send or give to Capital Gold
stockholders when the exchange offer is commenced or for any other document
which Timmins Gold may file with the SEC and Canadian securities regulators
and send to Timmins Gold or Capital Gold stockholders in connection with
the exchange offer. INVESTORS AND SECURITY HOLDERS OF TIMMINS GOLD AND
CAPITAL GOLD ARE URGED TO READ THE PROSPECTUS/OFFER TO EXCHANGE AND ANY
OTHER DOCUMENTS FILED WITH THE SEC AND CANADIAN SECURITIES REGULATORS
CAREFULLY IN THEIR ENTIRETY, BECAUSE THEY CONTAIN IMPORTANT INFORMATION
ABOUT THE EXCHANGE OFFER. Such documents, as well as solicitation
statements relating to the Consent Solicitation and the Proxy Solicitation,
will be available free of charge through the web site maintained by the SEC
at www.sec.gov, by calling the SEC at telephone number
800-SEC-0330, or at the web site maintained by the Canadian securities
regulators at www.sedar.com, or by directing a request to
Timmins Gold at Suite 520 - 609 Granville Street, Vancouver, BC, Canada
V7Y-1G5.
Timmins Gold and its directors and executive officers and other persons may
be deemed to be participants in any solicitation of proxies from Capital
Gold's shareholders in respect of the proposed transaction with Capital
Gold. Information regarding Timmins Gold's directors and executive officers
would be available in a prospectus/proxy statement Timmins Gold would file
with the SEC and Canadian securities regulators regarding the proposed
transaction if such a negotiated transaction with Capital Gold is reached
or in another document that Timmins Gold may file with the SEC and Canadian
securities regulators and send to Timmins Gold or Capital Gold shareholders
in connection with the proposed transaction. Other information regarding
potential participants in such proxy solicitation and a description of
their direct and indirect interests, by security holdings or otherwise,
will be contained in any proxy statement or other documents filed with the
SEC and Canadian securities regulators in connection with the proposed
transaction.
Caution Regarding Forward-Looking Statements
This press release contains forward-looking statements. Forward-looking
statements are statements which relate to future events. In some cases, you
can identify forward-looking statements by terminology such as
"may," "should," "expect," "plan,
"anticipate," believe," "estimate,"
"predict," "potential," "opportunity" or
"continue" or the negative of these terms or other comparable
terminology. These statements are predictions and involve known and unknown
risks, uncertainties and other factors that may cause our actual results,
production, reserves, level of activity, performance or achievements to be
materially different from any future results, production, reserves, levels
of activity, performance or achievements expressed or implied by such
forward-looking statements. Actual results could also differ materially
because of factors such as Timmins Gold's ability to promptly and
effectively integrate the businesses of Capital Gold and Timmins Gold, the
timing to consummate the proposed transaction and any necessary actions to
obtain required regulatory approvals, and the diversion of management time
on transaction-related issues. While these forward-looking statements, and
any assumptions upon which they are based, reflect our current judgment
regarding the direction of our business, actual results will almost always
vary, sometimes materially, from any estimates, predictions, projections,
assumptions or other future performance suggestions herein. Except as
required by applicable law, Timmins Gold does not intend to update any
forward-looking statements to conform these statements to actual results.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that
term is defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.
Contacts:
Timmins Gold Corp.
Bruce Bragagnolo
CEO and Director
604-638-8980
bruce@timminsgold.com
www.timminsgold.com
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