McEwen back in Red Lake camp with Rubicon

Vancouver – Financier Rob McEwen is set to acquire a 35% stake in Rubicon Minerals (RMX-T, RBY-X), a move that takes the former Goldcorp (G-T, GG-N), Chairman back to his roots in Red Lake, the fabled mining camp in northwestern Ontario.

During his 15 reign as head of Goldcorp, it was deep gold discoveries beneath the old Dickenson mine at Red Lake that created the wealth which transformed Goldcorp into a mining industry heavyweight.

Now, just 16 months after he left Goldcorp to build a property position in Nevada with U.S. Gold (USGL-O), McEwen is back on home turf with Rubicon, a company which controls 250 kilometres of exploration ground in Red Lake, including its flagship McFinley Red Lake drilling project.

I am excited to be back in Red Lake and to be involved in the creation of a new Rubicon, which will have a great combination of properties in the low-risk North American gold districts of Red Lake, Alaska and Nevada, he said.

Under an agreement announced on February 26, McEwen is making a private placement of $10 million in Rubicon in exchange for 14.3 million shares at 70 each. The shares come attached with two-year warrants, entitling him to buy another 7.15 million shares at $1.50 each.

Evanachan Ltd, a wholly-owed McEwen company, will also receive another 31.4 million shares at 70 in return for a 513,000-acre land package in Alaska. The sale of that package, which surrounds Teck Comincos (TCK.B-T, TCK-N) new Pogo gold mine, will bring McEwens stake in Rubicon up to 35%.

Lexam Explorations (LEX-V), a company in which McEwen is a major shareholder, will receive another 8.6 million shares [6.5%], priced at 70, in return to transferring to Rubicon, 225,000 acres of land in northeast Nevada.

That will leave McEwen and his associated companies with roughly 41% of Rubicons 131 million shares outstanding.

News that McEwen is prepared to back Rubicons exploration efforts sent the stock up 48 to $1.33 on Feb. 26. He has got the Midas touch, said Rubicon chief executive officer David Adamson. He sees opportunities early and then capitalizes on them.

Adamson said it was Rubicon which initiated the process of bringing the former Goldcorp. Chairman on board. He said the effort began after Rubicon recently spun off interests in properties in the Democratic Republic of Congo, and Newfoundland to re-focus on Red Lake.

We are putting together a go-to North American exploration company for investors who are leery of political risk, said Bill Cavalluzzo, a spokesman for Rubicon. We say your money is safe in Ontario, Alaska and Nevada.

One mining analyst was slightly amused to see McEwen return to his former stomping ground. Mr. Goldfinger strikes again, said Jim Mustard, a mining analyst with Haywood Securities in Vancouver. His involvement will elevate the level of exploration activity in Red Lake, Mustard said.

As Red Lake is seen as one of Canadas more mature mining camps, it is expected that Rubicon will use some of its $20 million cash to fund the type of deeper drilling that is being carried out in Red Lake by Gold Eagle Mines and by Rubicon at its former McFinley gold mine property.

Under the agreement, McEwen has committed to back the existing board and management of Rubicon for two years. Meanwhile, he will act as a strategic adviser to the company, nominate one of his own representatives to the board