RNS Number:1073M
ATH Resources plc
10 May 2005
Press Release 10 May 2005
ATH Resources plc
("ATH Resources" or "the Group")
This announcement amends the acquisition and open offer announcement which was
released at 07.00am today under RNS number 0796M.
The #16.8 million raised is before expenses.
Grievehill and Glenmuckloch coal sites contain in aggregate an estimated 4.1
million tonnes of proven and probable reserves of coal.
The Record Date is at the close of business on the 5 May 2005.
ATH Resources plc
("ATH Resources" or "the Group")
Acquisition of the Grievehill and Glenmuckloch Opencast Coal Sites
Open Offer of 9,923,392 New Ordinary Shares at 170 pence per share on the
basis of 1 New Ordinary Share for every 3 Existing Ordinary Shares
ATH Resources plc, one of the UK's largest coal producers, announces today that
the Group proposes to raise approximately #16.8 million (before expenses) by way
of an Open Offer of 9,923,392 New Ordinary Shares and plans to use the proceeds
to acquire two opencast coal sites in Scotland. The Open Offer is fully
underwritten by Seymour Pierce Limited.
Highlights
- Raising #16,869,766 before expenses by way of an Open Offer of 9,923,392
New Ordinary Shares at a price of 170p per New Ordinary Share.
- Open Offer on the basis of 1 New Ordinary Share for every 3 Existing
Ordinary Shares.
- Acquisition of the Grievehill and Glenmuckloch open cast coal sites from
The Scottish Coal Company Limited for a consideration of #18 million.
- Grievehill and Glenmuckloch coal sites contain in aggregate an estimated
4.1 million tonnes of proven and probable reserves of coal.
- Open Offer is fully underwritten by Seymour Pierce Limited.
- Open Offer is conditional on the passing of Resolutions to be proposed at
the EGM and on Admission.
Commenting on the Open Offer and the Acquisitions, Tom Allchurch, Chief
Executive of ATH Resources, said: "This acquisition increases the Group's
reserve base by over 160% and provides the business with longer term stability
while we continue to develop our own new mines. We believe that this open offer
presents investors with an excellent follow-on investment opportunity which both
strengthens and speeds up the growth and development of the Group."
For further information:
ATH Resources plc
Tom Allchurch, Chief Executive Tel: +44 (0) 1302 760 462
tom@ath.co.uk www.ath.co.uk
Seymour Pierce Limited
Sarah Wharry, Corporate Finance Tel: +44 (0) 207 107 8000
sarahwharry@seymourpierce.com www.seymourpierce.com
Media enquiries:
Abchurch
Henry Harrison-Topham / Charlie Jack Tel: +44 (0) 20 7398 7700
henry.ht@abchurch-group.com www.abchurch-group.com
The following information has been extracted without material adjustment from
the Prospectus to ATH Resources Shareholders dated 10 May 2005 containing
details of the Acquisition and Open Offer (the "Prospectus").
Introduction
ATH Resources announces today that the Company proposes to raise up to
#16,869,766 (before expenses) by way of an Open Offer of 9,923,392 New Ordinary
Shares at the Issue Price. The Open Offer has been fully underwritten by
Seymour Pierce and is being made on the basis of 1 New Ordinary Share for every
3 Existing Ordinary Shares held by Qualifying Shareholders at the Record Date.
The Open Offer is conditional, inter alia, on the passing of the Resolutions to
be proposed at the EGM, satisfaction of all conditions precedent to completion
of the Acquisitions (save for Admission) and on Admission.
The Company will use the net proceeds of the Open Offer, expected to amount to
approximately #16 million, towards the consideration for the proposed
acquisition of two opencast coal sites, Grievehill and Glenmuckloch, situated in
south-west Scotland, further details of which are set out in this announcement.
Background
The Ordinary Shares of ATH were admitted to trading on AIM on 11 June 2004. The
principal business of the Group is the operation of opencast coal sites in the
UK. The Company raised #11.25 million net of expenses on its admission to
trading on AIM. These funds were used to repay approximately #9 million of debt
within the business, with the remainder being used as working capital for the
development of the Group's business.
The Acquisitions
The Group through one of its subsidiaries has entered into a conditional
agreement with The Scottish Coal Company Ltd ("SCC") to acquire from it two
opencast coal sites at Grievehill and Glenmuckloch containing in aggregate an
estimated 4.1 million tonnes of proven and probable reserves of coal for a
consideration of #18 million. The completion of the Acquisition Agreement is
conditional, inter alia, on the following conditions precedent having been
satisfied prior to 3 June 2005 (or having been waived by the Company):
i. completion of due diligence to the satisfaction of the Company;
ii. the assignment or grant of appropriate leases and licenses in relation
to the Acquisitions; and
iii. Admission
The agreement and ancillary documents relating to the Acquisitions provide for
the sale and purchase of freehold land, the assignment of leases and the
transfer of consents to operate the Grievehill and Glenmuckloch sites. Further
terms of the Aquistions are set out in the Prospectus.
Grievehill
The Grievehill site is located in the County of East Ayrshire, approximately 8
km south east of the town of Cumnock and adjacent to the Company's existing
Garleffan site. It encompases approximately 118 hectares in total and contains
an estimated 1.3 million tonnes of proven and probable reserves of coal. The
Group already has an option to lease part of the site and on completion of the
Acquisitions will acquire the freehold of the remainder using part of the
proceeds of the Open Offer.
Geology
Approximately 300 boreholes have been drilled within the site area and its
immediate vicinity by the former British Coal Corporation. This covers
approximately 95 per cent. of the site with closely spaced drilling. The area
has been mined previously by underground methods and by some shallow
opencasting, and this has been allowed for in the reserve assessments. The
Group intends to mine 10 seams at the site.
Planning
The site has the benefit of a planning permission ready for issue, along with
the necessary environmental permissions and consents issued by the Scottish
Environmental Protection Agency, in respect of water discharges and dust control
at the site. Further details of the planning permission and other environmental
permissions and consents are set out in the Independent Geologist's Report
contained in the Prospectus.
Production plan
The Group intends to commence operations at Grievehill during the summer of 2005
with a view to commencing coal production in October 2005. One new O&K RH120E
excavator on backhoe configuration will be ordered, with delivery anticipated
for August 2005, and the site will also utilise equipment from the Group's
adjacent Garleffan site.
Coal from Grievehill will be processed at the existing Garleffan facility and
transported to the Group's Crowbandsgate rail loading point, from where it will
be dispatched to customers. The majority of coal from both sites will be sold
into existing and (when agreed) new electricity generator contracts. In order
to add value, some coal will also be used to supply industrial and housecoal
markets after preparation at the Group's Skares Road site.
The site is expected to produce coal for approximately two years, during and
after which the Group intends that it will be restored to low grade agricultural
and wildlife uses.
Glenmuckloch
The Glenmuckloch site is located approximately 15 km south-east of Cumnock and 7
km south-east of Grievehill. The site comprises approximately 216 hectares of
agricultural grassland, some woodland and wet heathland. The Carlisle to
Kilmarnock railway line is located adjacent to the southern boundary, with the
A76 some 800m further to the south. On completion of the Acquisitions, the
Group will acquire the freehold interest in approximately 70 per cent. of the
surface of the site and options to lease the remainder will be assigned. These
interests will be paid for by the Group using part of the proceeds of the Open
Offer.
Geology
The site was extensively drilled by the former British Coal Corporation in the
1980s and SCC has drilled approximately 30 additional boreholes since 2002. A
total of some 780 boreholes have been drilled within and immediately adjacent to
the site area. Almost all the boreholes have been geophysically logged to
provide good quality seam thickness data. The Group intends to work 17 coal
seams at the site to recover an estimated 2.8 million tonnes of proven and
probable coal reserves.
Planning
The site has planning permission, along with the necessary environmental
permissions and consents issued by the Scottish Environmental Protection Agency,
in respect of water discharges and dust control at the mine. Further details of
the planning and other environmental permissions and consents are set out in the
Independent Geologist's Report contained in the Prospectus.
Production Plan
Production is not planned to commence at Glenmuckloch until 2006. It is
intended that new excavation equipment will be ordered shortly after completion
of the Acquisitions for delivery in spring 2006, and that coal will be processed
on site at Glenmuckloch to service existing and (when agreed) new electricity
generator contracts and also to supply industrial and housecoal markets.
The Group is currently investigating the possibility of obtaining a Freight
Facilities Grant to assist with the construction cost of a new rail loading
facility adjacent to the site. If this option is not financially viable, the
coal will be taken by road to the Group's rail loading point at Crowbandsgate
for dispatch to the customers.
The Group intends to start work on site preparation in March 2006 and has
scheduled coal production to start in July 2006. The Group has planned the
output to be approximately 615,000 tonnes per annum and coal production at the
site is expected to last around four and a half years.
Principal terms of the Open Offer
The Company proposes to issue 9,923,392 New Ordinary Shares pursuant to the Open
Offer at the Issue Price which will raise #16,869,766 for the Company (before
expenses). Seymour Pierce has underwritten the Open Offer. The Prospectus
comprises a letter from Seymour Pierce, inviting Qualifying Shareholders to
apply for New Ordinary Shares at the Issue Price under the Open Offer.
The Open Offer is being made by Seymour Pierce as agent for the Company to
Qualifying Shareholders on the basis of:
1 New Ordinary Share for every 3 Existing Ordinary Shares
held at the Record Date and so on in proportion for any other number of Existing
Ordinary Shares held. Where appropriate, the entitlement of Qualifying
Shareholders will be rounded down to the nearest whole number of New Ordinary
Shares and any fractional entitlements will be aggregated and sold for the
benefit of the Company.
The New Ordinary Shares will, when issued and fully paid, rank pari passu in all
respects with the Existing Ordinary Shares of the Company and will rank in full
for all dividends and other distributions thereafter declared, made or paid on
the share capital of the Company.
Seymour Pierce, as agent for the Company, has conditionally agreed to use its
reasonable endeavours to place firm at the Issue Price 5,323,071 New Ordinary
Shares, for which irrevocable undertakings have been given by the Directors and
certain other Shareholders not to take up their entitlement under the Open
Offer, together with any aggregated fractional entitlements to New Ordinary
Shares and the New Ordinary Shares not being offered to overseas Shareholders
under the Open Offer, with its institutional and other clients. If valid
Applications Forms are not received for all of the New Ordinary Shares, such
number of New Ordinary Shares not so applied for will be subscribed at the Issue
Price by placees procured by Seymour Pierce, so agent for the Company. To the
extent that any such New Ordinary Shares are not so placed, Seymour Pierce will,
as underwriter, subscribe for them on the terms and conditions of the
Underwriting Agreement.
Qualifying Shareholders will receive with the Prospectus an Application Form
containing details of their entitlement to subscribe for New Ordinary Shares.
To be valid, completed Application Forms and payment in full must be received by
the Company's receiving agent, Capita Registrars, Corporate Actions, PO Box 166,
The Registry, 34 Beckenham Road, Beckenham, Kent BR3 4TH by 3.00 p.m. on 1 June
2005.
The Open Offer is conditional, inter alia, on the passing of the Resolution to
be proposed at the EGM, satisfaction of all conditions precedent to completion
of the Acquisitions (save for Admission), Admission and the Underwriting
Agreement becoming unconditional in all respects (save for Admission). It is
expected that dealings in the New Ordinary Shares will commence on AIM at 8.00
a.m. on 3 June 2005 (or such later time and date as shall be determined by
Seymour Pierce and the Company, being not later than 15 June 2005). If
Admission has not so occurred, application monies will be returned to applicants
without interest as soon thereafter as is practicable.
Further information on the Open Offer, including the procedure for application
and payment, is set out in the letter from Seymour Pierce in the Prospectus and
in the Application Form. The attention of Overseas Shareholders is drawn
specifically to the section entitled "Overseas Shareholders" contained in the
Prospectus.
Directors intentions
The Directors are intending to take up part of their entitlement to the New
Ordinary Shares under the Open Offer in respect of an aggregate of 59,290 New
Ordinary Shares. Each Director has signed an irrevocable undertaking to the
Company and to Seymour Pierce to that effect. Seymour Pierce has conditionally
agreed to use its reasonable endeavours to place the New Ordinary Shares in
respect of which the Directors' do not take up their entitlements with its
institutional and other clients.
Current trading and prospects
Trading for the first half of the current financial year, although better than
for the same period in the previous financial year, has been below Directors'
expectations. This follows an exceptionally wet winter which slowed coal
production in the first four months of the financial year. The Group has taken
steps to increase production with additional excavators being installed at the
Garleffan and Skares Road sites and trading for the second half of the current
financial year is expected to show a significant improvement.
Extraordinary General Meeting
The Open Offer is conditional on, inter alia, the approval of the Resolutions by
Shareholders which is to be sought at an EGM convened for 10.00 a.m. on 2 June
2005 for which a notice is set out in the Prospectus. At this meeting the
following special resolution will be proposed:
1. That:
1.1 the Directors be authorised pursuant to section 80 of the Act to allot
New Ordinary Shares up to an aggregate nominal value of #99,233.92,
such authority to expire at the conclusion of the Annual General
Meeting of the Company to be held in 2006; and
1.2 the statutory pre-emption rights contained in section 89 of the Act be
disapplied in relation to the allotment of equity securities for cash,
up to an aggregate nominal amount of #49,616.96 for the purpose of the
Open Offer, in connection with any offer by way of rights in the
future, and otherwise up to an aggregate nominal amount of #9,923.39,
such authority to expire at the conclusion of the Annual General
Meeting of the Company to be held in 2006.
Availability of the admission document
Copies of the admission document dated 10 May 2005 are available free of charge
from the Company's registered office and at the offices of Seymour Pierce
Limited, Bucklersbury House, 3 Queen Victoria Street, London, EC4N 8EL, during
normal business hours on any weekday (Saturdays, Sundays and public holidays
excepted) and will remain available for at least one month after Admission.
Open Offer details
Issue Price 170 pence
Number of New Ordinary Shares being issued 9,923,392
Number of Ordinary Shares in issue immediately following Admission 39,693,568
Percentage of the Enlarged Share Capital represented by the New Ordinary Shares 25%
Market capitalisation at the Issue Price #67.5 million
Gross proceeds of the Open Offer #16,869,766
Estimated net proceeds of the Open Offer #16,000,000
Expected timetable of principal events
Record date for Entitlement under the Open Offer 5 May 2005
Prospectus available 10 May 2005
Latest time and date for splitting of Application 3.00 p.m. on 27 May 2005
Forms to satisfy bona fide market claims under the
Open Offer
Latest time and date for receipt of Forms of Proxy 10.00 a.m. on 31 May 2005
for the EGM
Latest time and date for receipt of completed 3.00 p.m. on 1 June 2005
Application Forms and payment in full under the Open
Offer
EGM 10.00 a.m. on 2 June 2005
Admission and commencement of dealings in New 3 June 2005
Ordinary Shares
Delivery of New Ordinary Shares into CREST accounts 3 June 2005
Despatch of definitive share certificates (where By 10 June 2005
applicable) by
Application forms are personal to the Qualifying Shareholder named thereon. The
Application Form represents a right to apply for New Ordinary Shares. It is not
a document of title and may not be sold, assigned or transferred, except to
satisfy bona fide market claims in relation to purchases of Ordinary Shares
through the market prior to the ddate on which the Existing Ordinary Shares are
marked "ex" the entitlement to particpate in the Open Offer pursuant to the
Rules of the London Stock Exchange.
Definitions
The following definitions apply throughout this announcement, unless the context
otherwise requires:
"Aardvark TMC" Aardvark TMC Limited, a subsidiary company of ATH
"Act" the Companies Act 1985 (as amended)
"Acquisitions" The proposed acquisitions by ATH of the Grievehill
and Glenmuckloch open cast coal sites
"Acquisition Agreement" The agreement dated 6 May 2005 between the Aardvark
TMC and The Scottish Coal Company Ltd relating to
Acquisitions
"Admission" the admission of the New Ordinary Shares to trading
on AIM becoming effective in accordance with the AIM
Rules
"AIM" a market operated by London Stock Exchange plc
"AIM Rules" the rules of London Stock Exchange plc governing
admission to and the operation of AIM
"Alchemy Partners" Alchemy Partners LLP of 20 Bedfordbury, London WC2N
4BL
"The Alchemy Plan" the discretionary funds managed by Alchemy Partners
(Guernsey) Limited with advice from Alchemy Partners
"Application Form" the application form to be used by Qualifying
Shareholders in connection with the Open Offer
"Approved Scheme" means the Inland Revenue approved executive share
option scheme adopted by ATH on 7 June 2004, further
details of which are given in the Prospectus
"Acquisitions" the acquisitions by ATH of the Grievehill and
Glenmuckloch open cast coal sites
"Articles" the articles of association of the Company adopted
on 7 June 2004
"ATH" or "Company" ATH Resources plc
"Capita Registrars" a trading division of Capita IRG Plc
"CREST" the relevant system (as defined in the CREST
Regulations) for paperless settlement of share
transfers and the holding of shares in
uncertificated form which is administered by CRESTCo
"CRESTCo" CRESTCo Limited
"CREST Regulations" the Uncertificated Securities Regulations 2001
"Directors" or the "Board" the directors of the Company, whose names appear on
page 3 of the Prospectus
"EGM" the extraordinary general meeting of the Company
convened for 10.00 a.m. on 2 June 2005, notice of
which is set out at the end of the Prospectus
"Enlarged Share Capital" the Existing Ordinary Shares and the New Ordinary
Shares
"Existing Ordinary Shares" the Ordinary Shares in issue at the date of the
Prospectus
"Form of Proxy" the form of proxy accompanying this document for use
by Shareholders in connection with the EGM
"Group" or "ATH Group" ATH and its subsidiary undertakings
"Issue Price" 170 pence per New Ordinary Share
"LTIP" the long term incentive plan adopted by ATH on 7
June 2004, further details of which are set out in
the Prospectus
"Industry" the coal mining industry in the UK
"New Ordinary Shares" the 9,923,392 new Ordinary Shares to be issued by
the Company pursuant to the Open Offer
"Open Offer" the open offer of the New Ordinary Shares as set out
in the Prospectus
"Options" options or awards over Ordinary Shares granted
pursuant to the Share Option Schemes
"Ordinary Shares" ordinary shares of 0.5 pence each in the capital of
the Company
"POS Regulations" the Public Offers of Securities Regulations 1995
(as amended)
"Qualifying Shareholders" holders of Existing Ordinary Shares whose names
appear on the register as at the Record Date
excluding certain overseas Shareholders as described
in the Prospectus
"Receiving Agent" Capita Registrars
"Record Date" the close of business on 5 May 2005
"Resolutions" the resolutions set out in the notice of EGM at the
end of the Prospectus
"Seymour Pierce" Seymour Pierce Limited
"Shareholders" holders of Ordinary Shares
"Share Option Schemes" the Approved Scheme, the Unapproved Scheme and the
LTIP
"Unapproved Scheme" means the unapproved executive share option scheme
adopted by ATH on 7 June 2004, further details of
which are given in the Prospectus
"uncertificated" or recorded on the relevant register of the share or
security
"in uncertificated form" concerned as being held in uncertificated form in
CREST and title to which, by virtue of the CREST
Regulations, may be
transferred by means of CREST
"Underwriting Agreement" the conditional agreement dated 10 May 2005 between
Seymour Pierce and the Company further details of
which are set out in the Prospectus
This information is provided by RNS
The company news service from the London Stock Exchange
END
IOEGGGMKZGVGKZM
ATH Resources (LSE:ATH)
Historical Stock Chart
From Jun 2024 to Jul 2024
ATH Resources (LSE:ATH)
Historical Stock Chart
From Jul 2023 to Jul 2024
