Subscription of 34,999,015 Ordinary Shares

Central Rand Gold Limited

(Incorporated as a company with limited liability under the laws of Guernsey, Company Number 45108)

(Incorporated as an external company with limited liability under the laws of South Africa, Registration number 2007/0192231/10)

ISIN: GG00B92NXM24

LSE share code: CRND JSE share code: CRD

("Central Rand Gold" or the "Company")

Subscription of 34,999,015 Ordinary Shares at 3.5 pence per Ordinary Share

Central Rand Gold is pleased to announce that it is undertaking a subscription to raise £1.22 million through the subscription of 34,999,015 new ordinary shares at an issue price of 3.5 pence per ordinary share (the "Issue Price") (the "Subscription"). 14,279,371 new ordinary shares have already been allotted under the Company's existing authorities (the "First Subscription Shares"). The issue of the remaining 20,719,644 new ordinary shares (the "Second Subscription Shares") is conditional, amongst other things, on the passing of a resolution to be proposed at an extraordinary general meeting of the Company (the "General Meeting").

Background to and reasons for the Subscription

As announced on 22 December 2015, the board of directors of Central Rand Gold (the "Board") terminated discussions with four Asian investor groups in relation to the potential sale of Central Rand Gold (Netherlands Antilles) N.V. ("CRGNV"). The significant uncertainty caused by falling commodity prices and difficult market conditions across the junior mining sector, along with Company-specific factors such as the continued dewatering of the Central Basin, meant that no unconditional and appropriately valued proposals had been received for CRGNV. The Board considered that the continuation of the process would unnecessarily prolong shareholder uncertainty with no immediate prospect of a satisfactory outcome.

The Company continued to negotiate with one Asian investor regarding a strategic investment into Central Rand Gold, along with other third party investors, to provide funding in order to pursue growth opportunities for the Company. The proceeds of the Subscription will be used primarily to strengthen the Company's balance sheet and provide working capital in order to undertake continued surface mining operations, identify and source further plant feed material and facilitate a programme of plant upgrades and efficiency processes to further improve plant availability and recovery rates.

The Witwatersrand area, having been a gold mining area for over 100 years, has numerous old sand, slimes and rock dumps. With some of the older gold mines coming to the end of their life span, Central Rand Gold has identified a number of these which may provide the Company with opportunities to secure future feedstock for its metallurgical plant. During 2015, the Company undertook an extensive surface exploration programme and a number of near surface opencast opportunities were identified. The Company is presently mining two opencast slots (namely Slot 5 and Slot 7) and plans to develop an additional opencast slot in 2016.

Based on preliminary fieldwork and sampling exercises, the Company expects that the already identified opencast operations will provide sufficient material at an acceptable grade so as to allow for continued operation of the mine for a number of years. However, further fieldwork and sampling will be required in order for the Company to categorise this material as reserves. The Company continues to identify and source additional material from external sources to supplement the opencast operations and maximise the metallurgical plant's capacity. The opportunity to secure material from external sources is significant and the Company continues to advance discussions with various parties involving significant quantities of ore bearing material.

The management team remains optimistic regarding the viability of the surface mining strategy and is committed to optimise this further, however this is considered by the Board as an interim measure whilst dewatering of the underground operations continues.

Should the Board be successful in pursuing the growth opportunities, such as the acquisition of additional surface material from third parties, then there may be a requirement for additional capital to fund such an acquisition. In these circumstances, the Board will consider making an open offer to shareholders as soon as practical following admission of the Second Subscription Shares at the Issue Price, in order to raise additional funding and to allow shareholders to participate in the future growth and development of Central Rand Gold's operations. The net proceeds of the open offer would provide Central Rand Gold with capital to strengthen its financial position and provide additional working capital for the purposes outlined above, particularly to secure additional feedstock.

Operational update

Acid Mine Drainage

During the last quarter of 2015, the High Density Sludge ("HDS") plant underwent a process of upgrading the two thickeners. The thickener upgrades to the HDS plant were completed in December 2015 and the pumping rate has now increased from 72 million litres per day to 84 million litres per day.

At 28 January 2016, the water table measured at Central Rand Gold's operations, was at approximately 143 vertical metres below surface ("vmbs"). The Board anticipates that it will be able to access Central Rand Gold's underground mining areas when the water table is approximately 185 vmbs, which following a period of rehabilitation, should enable Central Rand Gold's underground mining operations to re-commence during 2017.

Mining operations

In the 12 months ended 31 December 2015, 205,022 tonnes (2014: 160,981 tonnes) were mined from the Company's open pits and other surface material sources. The average grade for Central Rand Gold's surface mining was 1.79 g/t (2014: 2.88g/t which included material from underground operations) for the year. The reason for the reduced grades is a result of the closure of the underground operations, which contained higher grade material.

Processing results

In the 12 months ended 31 December 2015, 189,444 tonnes, which includes 6,721 tonnes of material which was toll treated through an external processing plant (2014: 183,410 tonnes), were processed by Central Rand Gold, a 3.3 per cent. increase on the prior year period.

Total gold produced in the 12 months to 31 December 2015 was 7,188 ozs (2014: 6,646 ozs); which was 8.2 per cent. higher than that in the prior year. Gold production was impacted by the head grade reducing from 1.88 g/t to 1.79 g/t in 2015, which again was as a consequence of the closure of the underground operations. The average grade is expected to remain at this level whilst surface mining continues.

Central Rand Gold has focussed on improving its plant capacity and efficiency during 2015. A new 243 square metre leach tank was constructed and commissioned in June 2015, which will assist in improving the gold recovery. Various other engineering improvements have been introduced, which have contributed to cost savings. The mine call factor continued on a positive trajectory with an average "face to pour" mine call factor of 78 per cent. for the 12 months ended 31 December 2015.

Details of the Subscription

The Company has conditionally raised gross proceeds of approximately £1.22 million (USD$1.76 million) through the proposed issue of 34,999,015 new ordinary shares (the "Subscription Shares") at the Issue Price of 3.5 pence per ordinary share. The Subscription Shares have been conditionally subscribed for by a number of high net worth individuals including the principal of Zhejiang Golden Machinery Plant. The Issue Price represents a discount of approximately 28.6 per cent. to the middle market closing price of 4.75 pence per ordinary share on 4 February 2016. The Subscription Shares will represent approximately 26.88 per cent. of the enlarged issued share capital.

The Subscription Shares are not being made available to the public and are not being offered or sold in any jurisdiction where it would be unlawful to do so.

The Subscription Shares will, when issued and fully paid, rank pari passu with the existing ordinary shares, including the right to receive all dividends and other distributions declared, made or paid after the date of admission. No temporary documents of title will be issued.

Subscription Agreements

The Company has entered into subscription agreements with four investors for 34,999,015 Subscription Shares at an Issue Price of 3.5 pence per ordinary share.

First Subscription Shares

The Company has raised gross proceeds of approximately £0.50 million pursuant to the first subscription in relation to 14,279,371 First Subscription Shares at an Issue Price of 3.5 pence per share. The First Subscription Shares have been allotted by the Company, conditional only upon First Admission. Application will be made to the London Stock Exchange and to the JSE Limited ("JSE") for the First Subscription Shares to be admitted to trading on AIM and AltX. It is expected that First Admission will become effective and that dealings will commence on AIM at 8.00 a.m. (UK time) and on AltX at 9.00 a.m. (South African time) ("First Admission").

Following admission of the First Subscription Shares, the total issued share capital of the Company will increase to 109,475,179 ordinary shares. The Company does not hold any shares in treasury and therefore the total number of voting rights will be 109,475,179 ordinary shares. This figure may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company under the Financial Conduct Authority's Disclosure and Transparency Rules.

Second Subscription Shares

The Company has conditionally raised gross proceeds of approximately £0.73 million pursuant to the second subscription in relation to 20,719,644 Second Subscription Shares at an Issue Price of 3.5 pence per share (the "Second Subscription"). The issue of the Second Subscription Shares would exceed the Board's existing authorities to allot securities for cash on a non pre-emptive basis, and accordingly the General Meeting is being called to seek authority from shareholders to enable the Board, inter alia, to complete the Second Subscription. The Second Subscription is conditional upon admission of the Second Subscription Shares becoming effective on or before 8.00 a.m. (UK time) on 9 March 2016 (or such later time and/or date as Central Rand Gold and Panmure Gordon may agree, but in any event no later than 8.00 a.m. (UK time) on 23 March 2016) ("Second Admission").

Application will be made to the London Stock Exchange and to the JSE for the Second Subscription Shares to be admitted to trading on AIM and AltX. It is expected that Second Admission will become effective and that dealings will commence at 8.00 a.m. (UK time) on AIM and at 9.00 a.m. (South African time) on AltX on 9 March 2016.

Following the Subscription, the following subscribers' notifiable holdings in the enlarged issued share capital will be:

Following admission of the Second Subscription Shares, the total issued share capital of the Company will increase to 130,194,823 ordinary shares. The Company does not hold any shares in treasury and therefore the total number of voting rights will be 130,194,823 ordinary shares. This figure may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company under the Financial Conduct Authority's Disclosure and Transparency Rules following admission of the Second Subscription Shares anticipated on 9 March 2016.

Redstone Capital

Following the Subscription, the Redstone Capital concert party will be interested in 9.82 per cent. of the Company's enlarged issued share capital. The holdings of the Redstone Capital concert party following Second Admission and on the assumption of the full conversion of Redstone Loan Notes and Redstone Warrants into Ordinary Shares will be as follows:

*Nathan Taylor and Jason Hou, Directors of Central Rand Gold, are also shareholders in Redstone Capital and therefore have a beneficial interest in the shares held by Redstone Capital.

Related Party

Yizhou Gu who is subscribing for 8,959,174 Subscription Shares, is deemed to be a related party of Central Rand Gold by virtue of being a Substantial Shareholder in the Company (as defined in the AIM Rules for Companies). As a consequence, the Directors consider, having consulted with their nominated adviser, Panmure Gordon (UK) Limited, that the terms on which such commitment has been made is fair and reasonable insofar as shareholders are concerned.

Management incentives

The Board has approved the issue of 2,000,000 new ordinary shares to certain Directors and senior executive team as outlined below:

Name No of Ordinary Shares

Nathan Taylor 500,000

Jason Hou 500,000

Allen Phillips 500,000

Mark Austin 500,000

Under the terms of the incentive scheme the new ordinary shares will be granted to the recipients at nil cost and the new ordinary shares will vest in three equal tranches over three years. The management incentive scheme is in line with past practices of the Company to align, incentivise and retain key members of the Board and Company's executive team.

General Meeting

For the purposes of effecting the Second Subscription, a resolution will be proposed at an Extraordinary General Meeting to authorise the Company to issue the Second Subscription Shares. A notice convening the Extraordinary General Meeting to be held at the offices of Central Rand Gold Limited, CRG Slot 8, 10 Spencer Road, Robertville, Roodepoort, South Africa at 11.00 a.m. (UK time) on 7 March 2016 is being sent to shareholders today.

Recommendation and Irrevocable Undertakings

The Directors consider the Subscription and the passing of the resolution to be in the best interests of the shareholders and the Company as a whole. Accordingly, the Directors recommend that shareholders vote in favour of the resolution as they have irrevocably undertaken to do in respect of their beneficial holdings of an aggregate of 12,791,300 existing ordinary shares, representing approximately 13.44 per cent. of the issued share capital of the Company.

Circular

A circular is being posted to shareholders today. Copies of the circular will be available to the public free of charge from the offices of Panmure Gordon & Co plc, One New Change, London EC4M 9AF and at the offices of the Company at CRG Slot 8, 10 Spencer Avenue, Corner Robert Road, Robertville, Roodepoort, 1709, South Africa, during normal office hours, (Saturdays, Sundays and bank holidays excepted) from the date of this document until the 7 March 2016 and on the Company's website, at www.centralrandgold.com.

For further information, please contact:

Central Rand Gold +27 (0) 87 310 4400

Nathan Taylor / Allen Phillips

Panmure Gordon (UK) Limited +44 (0) 20 7886 2500

Mark Taylor / James Greenwood

Merchantec Capital +27 (0) 11 325 6363

Monique Martinez / Marcel Goncalves

Johannesburg

5 February 2016

Sponsor

Merchantec Capital

Panmure Gordon (UK) Limited, which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting as nominated adviser and broker to Central Rand Gold for the purpose of the AIM Rules in connection with the Subscription and, as such, its responsibilities are owed solely to the London Stock Exchange and are not owed to the Company or to any Director or to any other person or entity. Panmure Gordon (UK) Limited will not be responsible to any person other than the Company for providing the protections afforded to clients of Panmure Gordon (UK) Limited or for providing advice to any other person in connection with the Subscription or any other matter referred to herein. Panmure Gordon (UK) Limited Securities has not authorised the contents of, or any part of, this document, and no liability whatsoever is accepted by Panmure Gordon (UK) Limited for the accuracy of any information or opinions contained in this document or for the omission of any material information.

This announcement does not constitute, or form part of the Subscription or any invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any shares in the Company nor shall this announcement or any part of it, or the fact of its distribution, form the basis of, or be relied on, in connection with or act as any inducement to enter into any contract or commitment whatsoever with respect to the Subscription or otherwise.