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CENTRAL RAND GOLD LIMITED - Central Rand Gold enters into a strategic partnership with Zhejiang Golden Machinery Plant

Release Date: 01/09/2014 12:15:00      Code(s): CRD       PDF(s):  
Central Rand Gold enters into a strategic partnership with Zhejiang Golden Machinery Plant

Central Rand Gold Limited
(Incorporated as a company with limited liability under the laws of
Guernsey,
Company Number 45108)
(Incorporated as an external company with limited liability under the
laws of South Africa,
Registration number 2007/019223/10)
ISIN: GG00B92NXM24
LSE share code: CRND JSE share code: CRD
"Central Rand Gold" or the “Company”)



CENTRAL RAND GOLD ENTERS INTO A STRATEGIC PARTNERSHIP WITH
ZHEJIANG GOLDEN MACHINERY PLANT

-    Central Rand Gold has entered into a non binding Memorandum of
     Understanding (“MOU”) with Zhejiang Golden Machinery Plant
     (“ZGMP”).

-    The short-term priority of the Strategic Partnership is to focus
     on Central Rand Gold’s existing metallurgical plant to determine
     whether ZGMP can assist in the upgrade and optimisation program
     currently underway.

-    The medium- to long-term focus of the Strategic Partnership is to
     advance the Company’s ‘string of pearls’ development strategy, as
     the Company moves towards becoming an emerging mid-tier gold
     producer.

-    The Strategic Partnership will provide Central Rand Gold with
     access to ZGMP’s knowledge and expertise of plant design and
     engineering.

Background

The Company has a stated goal of becoming a mid-tier gold producer.
Key to achieving this goal is the success of the Company’s mid- to
long-term growth and development strategy. The board of directors of
the Company (“Board”) strongly believes that the chance of success of
this strategy is improved by aligning its interests with strategic
partners. In this regard, the Board has worked closely with Central
Rand Gold’s significant shareholder, Redstone Capital Limited, to
establish and develop a relationship with ZGMP, which is one of
China’s largest gold plant machinery manufacturers.

ZGMP has a successful record of identifying emerging gold producers
and assisting them with their growth and development through the
provision of customised plant and machinery. ZGMP has manufactured
mining and processing equipment for operating mines across the globe,
including   in   Africa.    For   additional  information   on   ZGMP,
shareholders are referred to ZGMP’s webpage, www.zjhjjx.com.
The Board is confident that the Strategic Partnership with ZGMP, and
the   potential   provision    of  customised  plant   and   machinery
manufactured by ZGMP, could offer significant benefits to the Company
in the future.

Memorandum of Understanding

The Company has entered into a non binding MOU with ZGMP. The
rationale for the MOU is to establish a framework to enable
information sharing and collaboration between Central Rand Gold and
ZGMP. The Board believes the Strategic Partnership could lead to a
potentially lower capital cost for ongoing improvements to the
existing metallurgical plant, coupled with a more effective roll-out
of the ‘string of pearls’ development strategy across Central Rand
Gold’s significant resource base. In terms of the MOU:

1. the Company and ZGMP will review the current upgrade and
   optimisation roll-out for the existing metallurgical plant to
   ascertain whether ZGMP can supply the appropriate plant and
   machinery at a competitive price; and
2. in the longer term, and once all the appropriate feasibilities have
   been completed for a new mining target area, ZGMP can assist in
   expediting the planning, design, engineering and construction of
   the above ground plant.

Should ZGMP ultimately provide the Company with any equipment or
services, the Company can elect to pay ZGMP through the issuance of
Shares in Central Rand Gold rather than in cash, subject to the
required shareholder approvals. This option would have the benefit of
reducing balance sheet strain while aligning the interests of Central
Rand Gold and ZGMP.

Commenting on the MOU, Johan du Toit, Chief Executive of the Company
stated “The signing of the memorandum of understanding with ZGMP is
an exciting progression in the development of Central Rand Gold that
complements the work that the Company is undertaking to advance its
‘string of pearls’ strategy along the 40km strike at the heart of the
world famous Witwatersrand Goldfield. The potential strategic
partnership with ZGMP provides a strong platform for Central Rand
Gold to transform into an emerging mid-tier producer.”

About Zhejiang Golden Machinery Plant
ZGMP is one of China’s largest private mining machinery manufacturers
and is located in the Zhejiang province. ZGMP has a significant and
well established client list, with many of its clients ranking
amongst the world’s largest gold and base metals producers, including
ZiJin Mining, Jiangxi Copper, Zhongjin Lingnan. The product list and
manufacturing capabilities of ZGMP are significant, with industry
leading capabilities in crushing and grinding circuits, mixing and
flotation equipment, concentration and filtration equipment and
hydrometallurgy equipment. Furthermore, ZGMP has the capability to
provide ancillary goods and services to its clients including
engineering services, building materials, metallurgy, nonferrous
metal, electric power, chemical industry and other basic industries.
ZGMP has manufactured mining and processing equipment for operating
mines across the globe including Asia, Africa, North America and
Australia.

For further information, please contact:
Central Rand Gold                          +27 (0) 87 310 4400
Johan du Toit / Nathan Taylor


Charles Stanley Securities Limited         +44 (0) 20 7149 6478
Marc Milmo / Mark Taylor


Merchantec Capital                         +27 (0) 11 325 6363
Monique Martinez / Marcel Goncalves


Jenni Newman Public Relations              +27 (0) 11 506 7351
Proprietary Limited
Jenni Newman


Johannesburg
1 September 2014

Sponsor
Merchantec Capital

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