Apollo Gold and Linear Gold Agree to Business Combination

News Bulletin

Apollo Gold and Linear Gold Agree to Business Combination

Wednesday, 24 Mar 2010

Apollo Gold Corporation and Linear Gold Corp. have announced the signing of a binding letter of intent to complete a business combination by way of a court approved plan of arrangement to create an emerging Canadian midtier gold producer.

Apollo has agreed to acquire all of the outstanding common shares of Linear in exchange for Apollo common shares at an agreed exchange ratio of 5.474 Apollo common shares per Linear common share, representing a 20.0% premium to Linear shareholders based on the 20-day volume weighted average share price (“VWAP”) of both companies.

Transaction Highlights Include

Linear shareholders will receive 5.474 Apollo common shares per Linear common share which implies a Linear share price of C$2.30 each or a total consideration of C$102M.

On a fully diluted basis, Apollo will be owned 57.1% by current Apollo shareholders and 42.9% by current Linear shareholders.

Linear will also purchase, by way of a private placement expected to close shortly after the date hereof (upon receipt of applicable stock exchange approvals), 62,500,000 Apollo common shares at a price of C$0.40 per share for gross proceeds of C$25,000,000

The merger has been unanimously approved by the boards of directors of both companies, and the management and directors of both companies have entered into support agreements, representing approximately 3.7 million Apollo shares and 3.4 million Linear shares

Following completion of the merger, Apollo will undergo a rebranding which will result in a new company name

Profile of Merged Group

2010 estimated production at Apollo's Black Fox Mine in the Timmins Mining District, Ontario of approximately 100,000 ounces of gold

Expected medium-term production growth by 2013 of approximately 70,000 additional ounces of gold per year from Linear's Goldfields project in northern Saskatchewan

Total reserves of approximately 2.3 million ounces of gold (within 31.2 million tonnes at an average gold grade of 2.3 grams per tonne) in Canada

Excellent exploration potential within highly prospective land packages in multiple jurisdictions, mostly in Canada and Mexico

Strengthened balance sheet with lowered debt burden and improved financial flexibility with cash and cash flows available for continued exploration and development

The merger is subject to customary closing conditions including receipt of all necessary court and regulatory approvals, including the approval of the Toronto Stock Exchange and the NYSE Amex. The merger is expected to close in the second quarter of 2010.

About Apollo

Apollo is a growing gold producer that operates the wholly owned Black Fox Mine in Ontario, Canada, which commenced gold production in May 2009. In 2010, Apollo expects to produce approximately 100,000 ounces of gold from its Black Fox Mill at total cash costs between US$500 and US$550 per ounce produced. Apollo is also exploring the adjoining Grey Fox and Pike River properties, all in the Timmins gold district in Ontario, Canada, as well as the Huizopa Joint Venture, (80 percent Apollo and 20 percent Minas De Coronado, S. de R.L. de C.V.), an early stage, gold-silver exploration project, approximately 16 kilometers (10 miles) southwest of Minefinders Dolores gold-silver mine, in the Sierra Madres in Chihuahua, Mexico.

About Linear

Linear Gold Corp is a well financed gold exploration and development company committed to maximizing shareholder value through a strategy of mine development, focused exploration, and effective risk management through selective partnerships and acquisitions. Linear's flagship development property located near Uranium City, Saskatchewan, hosts an economic gold deposit and is now in the development stage to become a 70,000 - 90,000 ounce per year gold producer. Linear also holds an extensive and diverse portfolio of mineral projects in the Dominican Republic and Mexico

Source: Apollo Gold Website March 2010

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