HGM.L Regulatory News (HGM)

Highland Gold Mining Limited to increase share in the Novoshirokinskoye Mine

23 November 2011 - Highland Gold Mining Limited ("Highland Gold" or the "Company") is pleased to announce that an Agreement of Intent has been signed between Stanmix Holding Limited (a wholly owned subsidiary of the Company) and its joint venture partner LLP Kazzinc, ("Kazzinc") for the acquisition of Kazzinc's 48.3% share in the Open Joint Stock Company Novo-Shirokinskiy Rudnik, the owner of the Novoshirokinskoye mine ("Novo").

The total consideration for this transaction is US$110 million of which US$47 million accounts for Kazzinc's 48.3% share in Novo and US$63 million to be paid as repayment of Kazzinc's share of intercompany debt. The transaction is expected to complete prior to the year end following the approval by Russian anti-monopoly authorities and completion of definitive legal documentation and will result in the Company's stake in Novo increasing to 96.6%. A further detailed announcement will be released at that time.

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