By Peter Shout

(Micro Cap News) Toronto - Moments ago Kinross Gold (NYSE: KGC; TSX: K) announced that made a C$2.62 offer to acquire all of the outstanding shares of Underworld Resources (TSX.V: UW), which is a 36% premium on the gold exploration company's shares.  Canadian Regulators halted trading of Underworld's stock moments before the news was released.

The trading halt on Underworld Resources' shares prompted Micro Cap News syndicate publisher, AXcess News, in the United States to call the company for comment.  A spokesperson there refused to answer questions until an announcement had been made, though he did say that, "The recent death of the Company's geologist had nothing to do with it."

Kinross, which has made known for some time that it was seeking acquisition candidates to replenish its gold projects, said this morning that it was making an offer to purchase all of the outstanding shares of Underworld Resources in exchange for 0.141 shares of Kinross Gold.

Kinross Gold's shares were down 22 cents, or 1.19% at C$18.32 at 9:44am ET in Toronto Thursday following the release of the news, though with the price of gold bullion falling this morning for the fourth day in a row, Kinross Gold's shares have continued to show downward pressure.

The deal is valued at C$139.2 million.

"The offer will provide Underworld shareholders with immediate value for Underworld's current assets and future growth potential," said Kinross President and Chief Executive Officer, Tye W. Burt.

Underworld's key asset is the White Gold project, located in the Tintina gold belt, approximately 95 km south of Dawson City, Yukon Territory.

Note: Micro Cap News is a newly-formed partnership of online news publishers through the World City Press Syndicate.  Micro cap news articles are appearing on CA news network Source Press in advance of the launch of the beta news website.  Peter Shout is a Source Press staff reporter in Canada.