Kinross Gold to increase stake in Underworld Resources to 11 per cent

By The Canadian Press

TORONTO - Kinross Gold Corp. (TSX: K.TO) said Friday it will increase its stake in Underworld Resources (TSXV: UW.V) to 11.1 per cent with the purchase of 1.8 million shares in the Vancouver-based junior.

The Toronto-based gold miner said it paid $1.5 million or $1.25 per share for 1.2 million units of Underworld, a mineral exploration company focused on a new gold discovery in the Yukon.

Each unit comes with half of a share purchase warrant. Each full warrant allows the holder to purchase one share at a price of $1.60 for up to a year following the closing of the private placement.

Kinross said that with the shares and the purchase warrants, it will increase its current stake in Underworld to more than 11 per cent.

"The investment in Underworld is part of Kinross' strategy to maximize exposure to new prospects and experienced explorationists at a relatively small capital investment by partnering with promising junior companies on a select basis," Kinross stated.

Kinross has mines and projects in the United States, Brazil, Chile, Ecuador and Russia. It also recently paid US$150 million for an indirect interest in the Diavik diamond mine in the Northwest Territories and a 20 per cent in Harry Winston Diamond Corp. (TSX: HW.TO).

Shares in Kinross were up $1.14 to $20.49, a change of almost six per cent, in Friday trading on the Toronto Stock Exchange. Underworld shares were down seven cents to $2.40.