Gammon Gold Completes Acquisition of Capital Gold

By Gammon Gold Inc, PRNE
Thursday, April 7, 2011

TORONTO, April 8, 2011 - Gammon Gold Inc. (TSX:GAM) (NYSE:GRS) ("Gammon") is pleased to announce
that it has completed its acquisition of Capital Gold Corporation
(NYSE AMEX:CGC) (TSX:CGC). Capital Gold will operate as a subsidiary of
Gammon Gold. Shares of Capital Gold will be delisted from trading on the NYSE
AMEX effective Friday, April 8, 2011.

Shareholders of Capital Gold voted to approve the merger with Gammon at a
special meeting of shareholders held on April 1, 2011. More than 82 percent
of Capital Gold's shareholders voted, of which 32,353,144 shares (or close to
2/3) voted in favour of the transaction.

The acquisition of Capital Gold significantly increases Gammon's gold
production and almost doubles its gold reserves, while strengthening the
Company's position as a leading, low cost, diversified gold and silver
producer focused on Mexico.

With Capital Gold's El Chanate mine contributing to production
immediately and El Cubo ramping up to full-scale production, Gammon will
shortly be operating three 100% owned, fully built mines in Mexico, advancing
two significant development projects, and managing a robust portfolio of
exploration stage properties.

"We are pleased to complete the acquisition of Capital Gold with the
support of Capital Gold's shareholders. Gammon's operational experience and
robust cash flow profile will allow our team to immediately enhance
operations at El Chanate and accelerate the development of the underground
Orion project," stated Rene Marion, President and CEO of Gammon. He
continued, "In approving the transaction, Capital Gold's shareholders clearly
recognized the value of combining the assets of the two companies to create a
leading, low cost, diversified gold and silver producer with excellent
organic growth opportunities."

Gammon's lead financial advisor for the transaction was Dundee
Securities. UBS Securities Canada Inc. was also retained as an advisor.
Gammon's Canadian legal counsel was Fasken Martineau DuMoulin LLP and its
U.S. legal advisor was Kirkland & Ellis LLP.

Capital Gold's lead financial advisor for the transaction was Cormark
Securities Inc. Stifel, Nicolaus & Company, Incorporated rendered fairness
opinions to Capital Gold's board of directors. Capital Gold's legal counsel
was Ellenoff Grossman & Schole LLC. Ballard Spahr LLP served as legal counsel
to the M&A Committee of the board of directors of Capital Gold and Macleod
Dixon served as Capital Gold's Canadian legal counsel.

About Gammon Gold

Gammon Gold Inc. is a publicly traded mid-tier gold and silver producer
engaged in the mining, development, exploration and acquisition of resource
properties in North America. The Company owns and operates three producing
mines in Mexico, the Ocampo mine in Chihuahua State, the El Chanate project
in Sonora State , and the El Cubo mine in Guanajuato State . Gammon Gold also
owns the Guadalupe y Calvo advanced exploration property in Chihuahua State
and the Orion advanced exploration property in the State of Nayarit, and has
six exploration properties in various states throughout Mexico. Gammon's
executive office is located in Toronto, Ontario Canada.

Cautionary Statement

This communication may contain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995 and
comparable "safe harbour" provisions of applicable Canadian legislation,
including, but not limited to, statements relating to anticipated financial
and operating results, the companies' plans, objectives, expectations and
intentions, cost savings and other statements, including words such as
"anticipate," "believe," "plan," "estimate," "expect," "intend," "will,"
"should," "may," and other similar expressions. Such statements are based
upon the current beliefs and expectations of our management and involve a
number of significant risks and uncertainties. Actual results may differ
materially from the results anticipated in these forward-looking statements.
The following factors, among others, could cause or contribute to such
material differences: the ability to ramp up El Cubo to full-scale
production, the ability to enhance operations at El Chanate and to accelerate
the development of the Orion project, the ability to realize the expected
synergies resulting from the transaction in the amounts or in the timeframe
anticipated; the ability to integrate Capital Gold Corporation's businesses
into those of Gammon Gold Inc. in a timely and cost-efficient manner; and the
outcome of pending litigation related to the proposed acquisition of Capital
Gold Corporation. Additional factors that could cause Gammon Gold Inc. and
Capital Gold Corporation's results to differ materially from those described
in the forward-looking statements can be found in the 2009 Annual Report on
Form 40-F, as amended by Amendment No. 1 to Annual Report on Form 40-F/A, for
Gammon Gold Inc. and the Annual Report on Form 10-K, as amended by Form
10-K/A, of Capital Gold Corporation for the fiscal year ended July 31, 2010
filed with the Securities and Exchange Commission and available at the
Securities and Exchange Commission's Internet site (

For further information: For further information: please visit the Gammon
Gold website at or contact: Rene Marion, President
and Chief Executive Officer, Gammon Gold Inc., +1-647-260-8880; Anne Day,
Director of Investor Relations, Gammon Gold Inc., +1-647-260-8880.

For further information: For further information: please visit the Gammon Gold website at or contact: Rene Marion, President and Chief Executive Officer, Gammon Gold Inc., +1-647-260-8880; Anne Day, Director of Investor Relations, Gammon Gold Inc., +1-647-260-8880

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