Severstal to buy 61.5 pct in Mano River’s Putu Range project for $37.5 mln

May 23, 2008

May 23 (Hemscott) – Mano River Resources said it signed a share purchase and subscription agreement (SPSA) with Russian steel and natural resources firm Severstal’s indirect wholly-owned Dutch subsidiary, Lybica Holding B.V.

Mano River said Lybica will pay $37.5 million for 61.5 percent in the Putu Range Iron Ore Project which is held by Mano’s 80 percent-owned subsidiary African Iron Ore Group Ltd. (AIOG).

Mano River also said Lybica has agreed to enter into a facility agreement, under which it will provide AIOG with further funding of up to $15 million.

Mano River added that Lybica will make an equity investment of about $4 million in Mano River at 10 pence a share, with an option to make an additional investment at 14 pence a share subsequently. Following the private placement Severstal will hold 6.29 percent of Mano’s issued share capital.


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