Mandalay Resources Announces Full Subscription on Financing

VANCOUVER , Oct. 16 /CNW/ - Mandalay Resources Corporation ("Mandalay" or the "Company") (TSX-V: MND), is pleased to announce that its private placement announced on September 24, 2009 of up to 46,000,000 units of common shares and warrants ("Units") at a price of $0.25 per Unit for aggregate proceeds of up to $11,500,000 has been fully subscribed.

Of the 46,000,000 Units that were subscribed for, 1,600,000 Units were issued today for aggregate proceeds of $400,000 . These securities are subject to a hold period expiring on February 17, 2010 . The proceeds will be used for the Company's existing property payments and general working capital.

The balance of the private placement, 44,400,000 Units, remains subject to various conditions including completion of the previously announced acquisition of AGD Mining Pty Ltd and TSX Venture Exchange approval. The private placement is expected to close prior to the end of the calendar year.

Brad Mills , CEO of Mandalay commented, "We are pleased by the high levels of demand for the placing, which was oversubscribed. The Company intends to use the proceeds of this placing to fund the ramp-up of the Costerfield gold mine to achieve our production target of 16,500 ounces of gold per year, and to further develop our Chilean assets."

In addition, the Company is pleased to announce it has retained The Capital Lab Inc. to provide investor relations and capital markets support services for Mandalay as it executes on its new strategy. The Capital Lab Inc.'s current retainer is $8,000 monthly and their office is located in Toronto , Canada , 76 Richmond Street East, Suite 330.

About Mandalay Resources Corporation

Mandalay Resources is a Canadian-based natural resource company with assets in production. The Company is focused on executing a roll-up strategy which involves aggregation of gold, copper, silver and antimony projects, creating critical mass through the acquisition of near-term or in-production assets in Australia and the Americas.

Forward-looking Statements

Certain statements contained herein constitute "forward-looking statements". These forward-looking statements are based on current expectations. The nature, timing and extent of the operations at the Company's projects may materially change from current intentions for a number of reasons. Additionally, forward-looking statements look into the future and provide an opinion as to the effect of certain events and trends on the business. Forward-looking statements may include words such as "plans," "may," "estimates," "expects," "indicates," "targeting," "potential" and similar expressions. These forward-looking statements, including statements regarding the Company's beliefs in the potential mineralization, are based on current expectations and entail various risks and uncertainties. Actual results may materially differ from expectations as more information regarding the property is gathered or if known and unknown risks or uncertainties affect the Company's business, or if the Company's estimates or assumptions prove inaccurate. The Company assumes no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or any other reason.

    
    The TSX Venture Exchange does not accept responsibility for the adequacy
    or accuracy of this release.
    

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For further information: Bradford Mills, Chief Executive Officer, Mandalay Resources Or Greg DiTomaso, Investor Relations, Mandalay Resources, Contact: [phone]