TIDMAAU
RNS Number : 2341O
Ariana Resources PLC
08 February 2021
8 February 2021
AIM: AAU
PUBLICATION OF CIRCULAR IN RESPECT OF CAPITAL REDUCTION AND
UPDATE ON COMPLETION OF THE JOINT VENTURE
Ariana Resources plc ("Ariana" or "the Company"), the AIM-listed
exploration and development company operating in Europe, is pleased
to announce the publication of its circular to shareholders (the
"Circular"), concerning the proposed reduction of share capital via
a cancellation of the Company's share premium account, the
cancellation of the deferred shares and the authority for the
Company to buy back shares.
Highlights:
-- Circular published on the Ariana Resources website, under Circulars (accessible via: https://arianaresources.com/investors/circulars ) and which has been posted to shareholders today.
-- General Meeting to consider and, if thought fit, approve
certain resolutions, which are proposed as special resolutions, to
be convened on 26 February 2021.
-- Completion of the Joint Venture with Ozaltin Holding A.S. and
Proccea Construction Co. is progressing as planned, following the
receipt of approval from the Competition Authority, as announced on
19 January 2021.
Dr. Kerim Sener, Managing Director, commented:
"This timely circular is being distributed in advance of the
completion of our new Joint Venture with Ozaltin and Proccea. The
proposed General Meeting concerns a capital reorganisation which
will enable the Company to pay a special dividend. Since receiving
shareholder ratification of the joint venture agreements signed at
the end of last year and the approval received from the Competition
Authority in Turkey last month, we are expecting to conclude all
remaining formal corporate procedures in the near future. We are
continuing to advance rapidly on all fronts and we look forward to
keeping the market updated on our progress."
Michael de Villiers, Chairman, commented:
"We have come a long way since the inception of the Company as a
junior explorer some 15 years ago. Our strategy has enabled us to
create a mechanism by which our shareholders will be rewarded
through the distribution of dividends; a status which is quite
unlike the majority of exploration and development companies
globally. We are now focused on positioning the Company so that we
can reward shareholders with a special dividend following
completion of the JV and possibly additional dividends in the
future. We trust that our shareholders will support this initiative
and vote alongside the Board in supporting all of the proposed
General Meeting resolutions."
Terms of the Proposed Capital Reduction
Under the current share structure, Ariana would need to generate
profits in excess of GBP9.6 million before it was able either to
pay a dividend or return cash to Shareholders in other ways. The
Directors are consequently proposing to modify the Company's share
structure to enable investors to obtain returns on their
shareholdings without having to wait until retained earnings of in
excess of GBP9.6 million have been generated.
At the date of the Circular, the Company has in issue
1,075,677,943 Ordinary Shares of GBP0.001 each, together with
554,949,474 Deferred Shares of GBP0.009 each. Over the years, the
Ordinary Shares have been issued at varying prices, which gave rise
to a Share Premium of GBP11,864,727 as at 30 September 2020. Since
the Company's formation, it has accumulated retained losses of
GBP9,568,727 as at 30 September 2020 and is likely to continue to
have made losses after that date.
The Directors believe the large level of these accumulated
losses is detrimental to the interests of Shareholders and hence
are looking at means of improving the Shareholders' position. For
example, the suggested special dividend relating to the new joint
venture arrangements with Ozaltin Holding A.S. (which were approved
by the Company at a General Meeting held on 30 December 2020) would
not be possible to the degree envisaged with the present level of
deficit in retained earnings.
A Company is permitted to reduce its share capital by the
Companies Act 2006 (Chapter 10). The reduction in its share capital
can then be offset against the losses in retained earnings. The
Directors accordingly propose to cancel the entire Share Premium
Account as at the date of a Court Hearing and to cancel all of the
Deferred Shares of GBP0.009 each (which were a necessary by-product
of a reduction in the nominal value of its ordinary shares from
GBP0.01 to GBP0.001, carried out on 28 June 2013). The effect of
this, and the offset of the remaining deficit on distributable
reserves mentioned above against the Share Premium Account which is
reduced to nil, is to generate distributable reserves of GBP7.48
million. As at the date of posting of this Circular the share
premium account is GBP12,053,227.
This announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014.
Contacts:
Ariana Resources plc Tel: +44 (0) 20 7407 3616
Michael de Villiers, Chairman
Kerim Sener, Managing Director
Beaumont Cornish Limited Tel: +44 (0) 20 7628 3396
Roland Cornish / Felicity Geidt
Panmure Gordon (UK) Limited Tel: +44 (0) 20 7886 2500
John Prior / Hugh Rich / Atholl
Tweedie
Yellow Jersey PR Limited Tel: +44 (0) 7951 402 336
Dom Barretto / Joe Burgess / Henry arianaresources@yellowjerseypr.com
Wilkinson
Editors' Note:
About Ariana Resources (details as current and before completion
of the JV) :
Ariana is an AIM-listed mineral exploration and development
company operating in Europe. It has interests in gold production in
Turkey and copper-gold assets in Cyprus. The Company is developing
a portfolio of prospective licences in Turkey, which contain a
depleted total of c. 2.1 million ounces of gold and other metals
(as at July 2020).
The Red Rabbit Project is comprised of the Company's flagship
assets, the Kiziltepe and Tavsan gold projects, and is part of a
50:50 Joint Venture with Proccea Construction Co. Both assets are
located in western Turkey, which hosts some of the largest
operating gold mines in the country and remains highly prospective
for new porphyry and epithermal deposits. The Kiziltepe Sector of
the Red Rabbit Project is fully permitted and is currently in
production. The total depleted resource inventory at the Project
and its wider area is c. 500,000 ounces of gold equivalent (as at
April 2020). At Kiziltepe a Net Smelter Return ("NSR") royalty of
up to 2.5% on production is payable to Franco-Nevada Corporation.
At Tavsan an NSR royalty of up to 2% on future production is
payable to Sandstorm Gold.
The 100% owned Salinbas Gold Project is located in north-eastern
Turkey and has a total resource inventory of c. 1.5 million ounces
of gold. The project comprises three notable licence areas:
Salinbas, Ardala and Hizarliyayla, all of which are located within
a multi-million ounce Artvin Goldfield. The "Hot Gold Corridor"
contains several significant gold-copper projects including the 4
million ounce Hot Maden project, which lies 16km to the south of
Salinbas and 7km south of Hizarliyayla. A NSR royalty of up to 2%
on future production is payable to Eldorado Gold Corporation on the
Salinbas Gold Project.
Ariana is also earning-in to 50% of UK-registered Venus Minerals
Ltd ("Venus") and has to date earned into an entitlement to 16%.
Venus is focused on the exploration and development of copper-gold
assets in Cyprus.
Panmure Gordon (UK) Limited is broker to the Company and
Beaumont Cornish Limited is the Company's Nominated Adviser and
Broker.
For further information on Ariana you are invited to visit the
Company's website at www.arianaresources.com .
Ends.
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END
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