Kennedy Ventures PLC Conditional Investment in Tantalite Project (1341O)
August 04 2014 - 2:52AM
UK Regulatory
TIDMKENV
RNS Number : 1341O
Kennedy Ventures PLC
04 August 2014
4 August 2014
Kennedy Ventures plc
Acquisition of Tantalum Mine in Namibia
Kennedy Ventures plc ("Kennedy Ventures" or "the Company") is
pleased to announce the signing of a conditional agreement for the
acquisition of 75% of African Tantalum (Pty) Limited ("Aftan") for
a total consideration of R12m (GBP0.66m), R4m (GBP0.22m) of which
will be satisfied through the issuance of 4,523,113 Ordinary Shares
in Kennedy Ventures at a price of 4.9p per share, (average closing
price over 15 days up to and including 31 August 2014) and the
remainder through a loan of R8m (GBP0.44m), (the "Transaction").
The 75% stake of Aftan, a Namibian incorporated investment vehicle,
is being acquired from a group of private investors.
Aftan has signed a conditional agreement with Magnum Mining and
Exploration Limited ("Magnum") to acquire 60% of the Tantalite
Valley Project ("TV Project") in Namibia, a mine which it is
intended will be brought back into production of tantalite, used in
the production of tantalum, within six months of completion of the
Transaction.
Demand for Tantalum
The principal demand for tantalum is from the electronics
industry, where tantalum capacitors are used in electronic
equipment such as mobile phones, tablets, laptop computers and
video game systems. In addition, tantalum is used to produce a
variety of super alloys which can be used to manufacture high
temperature cutting tools and other applications where its high
melting point and corrosive resistant properties are required.
Tantalum has a very high melting point and has exceptional heat
conducting capabilities. Tantalite ore, 30% Ta2O5, trades at
US$207/kg currently, whilst the high grade 99.8% Tantalite trades
at US$420/kg.
In August 2012, the US Securities and Exchange Commission
adopted a rule mandated by the Dodd-Frank Wall Street Reform and
Consumer Protection Act to require companies reporting to the SEC
to publicly disclose the origins of the tantalum they buy in order
to restrict the use of conflict minerals that originated in the
Democratic Republic of the Congo or an adjoining country. As a
result, users of tantalum are encouraged to demonstrate that their
supply chain is transparent to ensure that conflict-free tantalum
is procured.
It is intended that the tantalum produced by Aftan would be
conflict-free and the Company would anticipate that a premium to
tantalum from conflict areas could therefore be charged.
Background to TV Project
The TV Project is located approximately 14km north of the Orange
Riverwhich forms the border between
South Africa and Namibia. Approximately 90km north of Tantalite
Valley is the town of Karasburg in Namibia.
This town lies on a main tarred road and railway line linking
South Africa with Namibia.
The name Tantalite Valley is derived from the high-grade
tantalite occurring in various pegmatite ore bodies that outcrop in
this mountainous area of southern Namibia. Tantalum minerals occur
within carbonatite and alkaline rocks known as pegmatites, the most
important mineral being tantalite (Fe,Mn). The mineralised
pegmatites which occur at Tantalite Valley are found within the
mining licence area which is some 452.7 hectares in extent.
Historical Data and Development plan
Extensive work including diamond and reverse circulation
drilling, pitting and trenching as well as metallurgical test work
has been undertaken on the Tantalite Valley pegmatite's in the
past, this work has indicated an insitu pegmatite tonnage in excess
of 2 million tons. Due to logistics and pricing constraints in the
past, very little commercial mining has been undertaken. Aftan is
reviewing the geological models upon which the insitu pegmatite
tonnage is based together with all the other historical information
and will publish the results of the review once it has completed
it. In the interim Aftan's development plan has been reviewed by Mr
Peter Price PrEng a Consulting Mining Engineer with extensive
experience in mining pegmatites. Mr Price is of the opinion that
the development plan is realistic.
Transaction conditions
Aftan will assume responsibility for funding and operating the
TV Project and has an assignable, 100% interest in any revenues
generated by the TV Project in the 30 months following
completion.
Completion of the Transaction is conditional, inter alia,
upon:
-- Confirmation of mining tenure at the TV Project. Magnum has
been advised that the Namibian Minister of Mines and Energy is
conducting a review of the TV Project's mining licence as part of a
broad-reaching review of mining tenure in Namibia generally.
-- In-country regulatory approvals being made. Magnum is
currently taking local law advice on the Namibian regulatory
approvals that may be required in order to complete the Transaction
(if any).
-- Each of the conditions to the Transaction must be satisfied
or waived by 31 December 2014 or such later date agreed by Magnum
and Aftan.
Giles Clarke, Chairman of Kennedy Ventures said:
"This is the first step in our intention to build Kennedy
Ventures into a Namibian based producer of the highest grade of
tantalum, which when certified, is a highly valuable commodity
given its use in nearly every modern electronic device. Its origin
matters to end users such as the world's large electronics
companies due to their desire to comply with the US regulations on
the use of tantalum. We intend to build upon this initial mine and
utilise wide ranging international financing options to create
significant value for shareholders in a fully integrated
business."
Ends
For further information, please contact:
Kennedy Ventures plc
Giles Clarke c/o +44 (0) 020 3757
Billy Clegg 4983
Cenkos Securities plc
Derrick Lee / Alan +44 (0) 131 220
Stewart 6939
Peterhouse Corporate Finance
+44 (0) 207 469
John Levinson 0935
Camarco
Billy Clegg / Georgia
Mann +44 (0)20 3757 4983
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCSSSSMLFLSEIA
Kazera Global (LSE:KZG)
Historical Stock Chart
From Jul 2024 to Aug 2024
Kazera Global (LSE:KZG)
Historical Stock Chart
From Aug 2023 to Aug 2024