MEDIA DISTRIBUTION BY

Korab Resources Ltd [KOR] - Korab shareholders support distribution of free shares

MAJOR SHAREHOLDERS SUPPORT DISTRIBUTION OF FREE SHARES
HIGHLIGHTS
100% of major shareholders polled by the Company intend to vote in support of the in-specie distribution of the free shares in Melrose Gold Mines and Lugansk Gold to Korab shareholders.


Notice of a meeting has been issued for an Extraordinary General Meeting (EGM) to be held on 2 July 2010 to approve the in-specie distribution of shares in Melrose Gold Mines and Lugansk Gold to Korab shareholders.
Korab shareholders to receive 1 - 1.27 free shares in Lugansk Gold.

Lugansk Gold Ltd indicative IPO issue price has been set at 26-34 cents per share
Korab shareholders to receive 1 - 1.27 free shares in Melrose Gold Mines.

Melrose Gold Mines Ltd indicative IPO issue price has been set at 20-24 cents per share
The shares in each company will be distributed between 1 month and 6 months after the listing of each company on ASX
Lugansk Gold and Melrose Gold Mines intend to lodge their IPO prospectus in July 2010
Both IPOs have received strong interest from institutional and retail investors and brokers

Korab has polled major shareholders holding over 53% of issued shares to ask them their voting intentions for the upcoming Extraordinary General Meeting (EGM) and has received confirmations that all 100% of the shareholders polled intend to vote in favour of the resolutions to distribute the free shares in Melrose Gold Mines and Lugansk Gold to Korab shareholders.


The EGM has been called for 2 July to approve the transfer of 100 million Lugansk Gold shares and approximately 100 million Melrose Gold Mines shares held by Korab to Korab shareholders.

The shares will be distributed free of charge.

Melrose Gold Mines and Lugansk Gold intend to lodge their IPO prospectuses in early July 2010.


�What this amounts to is effectively confirming that the distribution of free shares to Korab shareholders is a done deal� � commented Korab�s chairman, Andrej Karpinski
Although the shareholders will vote on the distributions of free shares prior to the IPO�s, the actual distributions will take place after the IPO�s.


�I think that the free shares are likely to be distributed about a month or so after Melrose and Lugansk list on ASX.

In any case, the distributions have to occur not later than 6 months after the IPOs,� � noted Andrej Karpinski.


The upcoming IPOs of Lugansk Gold and Melrose Gold Mines have received strong interest from institutional and retail investors and brokers in Australia and overseas.


�We haven�t even issued a prospectus and we are already getting bombarded with calls from funds and brokers asking for firm allocations of shares� � said Mr.

Karpinski � �It is pretty clear they can see the opportunity to make money.�
Korab�s gold mining projects have been spun-off into two independent companies which will seek listing on ASX this year.

Lugansk Gold is operating a gold mining project in Ukraine.

Melrose Gold Mines will take over operations of Melrose gold project located near Leinster in the Eastern Goldfields of Western Australia.