Reference no: EM13623797

It was December 31, 2013, and the phone lines at the Toronto headquarters of Gabriel Resources <br/>(Gabriel) would not stop ringing. The calls were related to Gabriel’s foreign mining project in Romania <br/>and the recent draft bill to approve its further development. On December 10, the Romanian Parliament <br/>voted on the final permit of Gabriel’s Rosia Montana gold and silver project. The vote resulted in an <br/>outright majority to ban further development of the project until a more thorough environmental and legal <br/>framework was established. This outcome followed a December 2 vote that also failed to receive the <br/>requisite majority for project approval. <br/>Approval of the draft bill was set to increase Romania’s state-controlled stake in the project to 25 per cent <br/>and up royalties from 4 per cent to 6 per cent. The controversial mine had been protested for years by <br/>interest groups inside and outside of Romania, mainly due to potential environmental impacts. This last <br/>setback made it appear that Gabriel would not be able to move forward with desired development efforts. <br/>After three months of increasing opposition from environmental and community groups, investors were <br/>starting to get worried. Shares of Gabriel closed the year at $0.78, <br/>2 down roughly 30 per cent from the <br/>December 16 price of $1.10 (see Exhibit 1). Management had to act quickly with a plan to move forward <br/>as smoothly as possible. How should the company handle investor relations in order to calm shareholder <br/>panic and negative stock price movement? More importantly, what steps should be taken to help bring the <br/>mine forward to development?