Issue of Equity

10 Feb 2006 14:00

Caledonia Mining Corporation10 February 2006 Caledonia Mining Corporation Caledonia Completes Private Placement Toronto, Ontario - February 10th 2006: Caledonia Mining Corporation ("Caledonia")(TSX: CAL, NASDAQ-OTCBB: CALVF, AIM: CMCL) is pleased to announce the completion of a $3,495,201 private placement financing. The placement, which was handled by fiscal agents in Europe, was for 33,287,626units priced at $0.105 each. Each unit consists of one common share and oneshare purchase warrant. Each warrant entitles the holder to purchase one commonshare of Caledonia at a price of $0.20 for a period of 24 months from the dateof issue. The funds raised will be used to fund some of the recently completed capitalimprovements in the Underground and the Metallurgical Plant expansion at theBarbrook Mine in South Africa, and the exploration activities at the Eerstelinggold property and the Rooipoort PGE Project in South Africa, and at the NamaCobalt property in Zambia, and for general corporate purposes. Stefan Hayden, President and CEO of Caledonia said: "The commissioning of theBarbrook gold mine expansion project in South Africa is virtually complete.There is ongoing optimization of the expanded metallurgical circuits but I ampleased to report that generally the plant is performing as expected. Mining isprogressing well and the development of the newly found ore zones continue toshow they are economically mineable." Caledonia continues to be debt free. Application has been made by the Company for the 33,287,626 new common shares tobe admitted to trading on AIM and admission to AIM is expected to occur on 14February 2006. Further information regarding Caledonia's exploration activities and operationsalong with its latest financials may be found at www.caledoniamining.com. For more information, please contact: Stefan Hayden Alex Buck / Nick BiasPresident and CEO, Caledonia Mining buck-biasTel: +27 11 447 2499 Tel: +44 7932 740 452 Certain statements included herein are "forward-looking statements". Managementcautions that forward-looking statements are not guarantees and that actualresult could differ materially from those expressed or implied in theforward-looking statements. Important factors that could cause the actualresults of operations, exploration or development programs, or the financialcondition of the Company, to differ include, but are not necessarily limited to,the risks and uncertainties discussed in documents filed by the Company with thevarious regulatory authorities having jurisdiction. This information is provided by RNS The company news service from the London Stock Exchange