Gammon Gold Announces Strategic Investment in Golden Queen Mining Company

TSX: GAM / NYSE: GRS / BSX: GL7

HALIFAX, Canada, May 28, 2010 - Gammon Gold Inc. ("Gammon") (TSX:GAM and NYSE:GRS): Gammon is pleased to
announce that it has signed an agreement to acquire 5,000,000 units of
Golden Queen Mining Co. Ltd. ("Golden Queen") pursuant to a non-brokered
private placement. Each unit consists of one common share, one quarter of
one share purchase warrant exercisable at CAD $1.75, and one quarter of one
share purchase warrant exercisable at CAD $2.00 for a period of 18 months
from the closing date of the transaction. The subscription price for the
units is CAD $1.60 per unit for an aggregate purchase price of CAD $8,000,
000. After giving effect to the private placement, Gammon Gold will hold
approximately 5.3% of the issued and outstanding common shares (
approximately 7.5% on a fully diluted basis) of Golden Queen. Gammon will
have the right to participate in all future financings of Golden Queen to
maintain its proportionate shareholding. Closing of the transaction is
expected to be on or before June 1, 2010.

The investment in Golden Queen is part of Gammon's growth strategy of
identifying and investing in quality companies and assets located
throughout North America.

Golden Queen is a gold exploration and development company listed on
the TSX (TSX: GQM), whose principal asset is the 100% interest in the pre-
development stage gold-silver Soledad Mountain property ("Soledad") located
in Kern County, Southern California.

About Gammon Gold

Gammon Gold Inc. is a mid-tier gold and silver producer with
properties in Mexico. The Company's flagship Ocampo Project in Chihuahua
State achieved commercial production in January 2007. Gammon Gold also
operates its El Cubo operation in Guanajuato State and has the promising
Guadalupe y Calvo development property in Chihuahua State. The Company
recently completed a purchase option agreement to acquire the Mezquite
Project ("Mezquite") in Zacatecas State, Mexico. The Company is based in
Halifax, Nova Scotia with an Executive Office in Toronto, Ontario.

Cautionary Statement

Cautionary Note to US Investors - The United States Securities and
Exchange Commission permits US mining companies, in their filings with the
SEC, to disclose only those mineral deposits that a company can
economically and legally extract or produce. This press release uses
certain terms, such as "measured," "indicated," and "inferred" "resources,"
that the SEC guidelines strictly prohibit US registered companies from
including in their filings with the SEC. US Investors are urged to consider
closely the disclosure in Gammon Gold's Annual Report on Form 40-F/A, which
may be secured from Gammon Gold, or from the SEC's website at
www.sec.gov/edgar.shtml.

No stock exchange, securities commission or other regulatory authority
has approved or disapproved the information contained herein.

Certain statements included herein, including information as to the
future financial or operating performance of Gammon, its subsidiaries and
its projects, constitute forward-looking statements. The words "believe",
"expect", "anticipate", "contemplate", "target", "plan", "intends", "
continue", "budget", "estimate", "forecast", "may", "will", "schedule" and
similar expressions identify forward-looking statements. Forward-looking
statements include, among other things, statements regarding its financial
exposure to litigation, targets, estimates and assumptions in respect of
gold and silver production and prices, cash and operating costs, results
and capital expenditures, mineral reserves and mineral resources and
anticipated grades, recovery rates, future financial or operating
performance, margins, operating and exploration expenditures, costs and
timing of the development of new deposits, costs and timing of construction
, costs and timing of future exploration and reclamation expenses,
anticipated 2009 year-end and 2010 results, operating performance
projections for 2009 and 2010, our ability to fully fund our business model
, including our capital program and exploration, internally, 2009 and 2010
gold and silver production and the cash and operating costs associated
therewith, the ability to achieve productivity and operational efficiencies
, the ability to achieve cash flow margin improvements, further reduction
in the open pit stripping ratio, the ability to develop and put into
production our exploration targets, and the timing of each thereof.
Forward-looking statements are necessarily based upon a
number of estimates and assumptions that, while considered reasonable by
Gammon, are inherently subject to significant business, economic,
competitive, political and social uncertainties and contingencies. Many
factors could cause Gammon's actual results to differ materially from those
expressed or implied in any forward-looking statements made by, or on
behalf of, Gammon. Such factors include, among others, known and unknown
uncertainties and risks relating to additional funding requirements,
reserve and resource estimates, commodity prices, hedging activities,
exploration, development and operating risks, illegal miners, political and
foreign risk, uninsurable risks, competition, limited mining operations,
production risks, environmental regulation and liability, government
regulation, currency fluctuations, recent losses and write-downs,
restrictions in Gammon's loan facility, dependence on key employees,
possible variations of ore grade or recovery rates, failure of plant,
equipment or process to operate as anticipated, accidents and labour
disputes. Investors are cautioned that forward-looking statements are not
guarantees of future performance and, accordingly, investors are cautioned
not to put undue reliance on forward-looking statements due to the inherent
uncertainty therein.

For further information: Rene Marion, Chief Executive Officer, Gammon
Gold Inc., +1(416)646-3825; Anne Day, Director of Investor Relations, Gammon
Gold Inc., +1(902)468-0614; www.gammongold.com (GAM. GRS)

For further information: Rene Marion, Chief Executive Officer, Gammon Gold
Inc., +1(416)646-3825; Anne Day, Director of Investor Relations, Gammon Gold
Inc., +1(902)468-0614; www.gammongold.com (GAM. GRS)