Acquisition

FOR:  CALEDONIA MINING CORPORATION

TSX SYMBOL:  CAL
OTC Bulletin Board SYMBOL:  CALVF
AIM SYMBOL:  CMCL

March 4, 2008

Caledonia Mining Accepts Offer of C$3.81 Million for Eersteling Gold Mine

TORONTO, ONTARIO--(Marketwire - March 4, 2008) - Caledonia Mining Corporation ("Caledonia")
(TSX:CAL)(OTCBB:CALVF)(AIM:CMCL) is pleased to announce it has accepted an offer for the purchase of the entire
issued share capital of Eersteling Gold Mining Company Limited ("Eersteling") in South Africa by a private
Canadian company for C$3.81 million.

The offer is to be settled in cash on or before July 31, 2008 and a refundable deposit of C$0.4 million is to
be placed in trust upon signing of the final agreements by no later than March 31, 2008. The offer is subject
to the approval of the Board of Directors of both parties. A non-refundable break fee of C$131,000 will be paid
to Caledonia by March 8, 2008. In addition, the monthly running costs of Eersteling of approximately C$8,000
will be paid in advance to Caledonia from 3 March 2008, until completion of the transaction.

Eersteling is a wholly owned subsidiary of Caledonia and includes the assets & liabilities of the Eersteling
Gold Mine, located in the Limpopo province of South Africa. The mine has been on care and maintenance since
1997. As at September 30, 2007 Eersteling had a carrying value of C$1.03 million on the Caledonia balance sheet
and, in the nine month period ended September 30, 2007, generated losses of C$0.1 million.

The sale of Eersteling will enable Caledonia's management to focus on the development of the Nama Cobalt
Project in Zambia and on the producing Blanket gold mine in Zimbabwe. Proceeds from the sale will be used to
further advance the Nama Project.

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FOR FURTHER INFORMATION PLEASE CONTACT:

Caledonia Mining
Stefan Hayden
President & CEO
[phone]
Website: www.caledoniamining.com

OR

BuckBias
Alex Buck
[phone]

OR

RBC Capital Markets
Andrew Smith
[phone]

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Caledonia Mining Corporation