TIDMSULA
RNS Number : 4058M
Sula Iron & Gold PLC
13 October 2016
13 October 2016
Sula Iron & Gold plc
("Sula" or the "Company")
Subscription to Raise US$400,000 Gross
Proposed Appointment of new CEO and Non-Executive Director
Proposed Grant of Warrants and Options
Sula Iron & Gold plc, a multi-commodity exploration company
focused on Sierra Leone, announces that it has conditionally raised
US$400,000 (before expenses) through a subscription for 304,642,410
new ordinary shares of 0.1p each in the Company ("New Ordinary
Shares") (the "Subscription Shares") at a price of 0.1p per
Subscription Share (the "Subscription Price") (the
"Subscription").
The Subscription Shares are being subscribed for by Madini
Occidental Ltd ("MO"), a private company incorporated in the
Republic of Seychelles, which is currently owned by Madini Minerals
("Madini") and Ian Schofield who are interested in 75.0 per cent.
and 25.0 per cent. of its issued share capital respectively.
Madini is a privately owned enterprise, incorporated in
Mauritius, formed by mining professionals with a focus on acquiring
stakes in, and applying its extensive technical and commercial
capabilities to, African based advanced exploration and
development-stage projects.
Ian Schofield is a private high-net worth investor with
experience in investing in natural resources companies. Ian
Schofield is also currently interested in 9.2 per cent. of the
issued share capital of Madini.
In lieu of any commission payable in cash in relation to the
Subscription, Sula has agreed, subject to receipt of the entire
Subscription proceeds, to issue a further 15,232,120 fully paid New
Ordinary Shares (the "Commission Shares"), together with the
Commission Warrants (as described below) to Madini or its nominated
subsidiary.
Subject to admission to trading on AIM, the Subscription Shares
and Commission Shares will represent, in aggregate, approximately
26.16 per cent. of the Company's enlarged issued share capital. The
Subscription Price equates to the prevailing closing mid-market
price of the Company's ordinary shares of 0.1p per ordinary share
on 12 October 2016 (being the latest practicable business day prior
to the date of this announcement).
The Subscription will be completed in two equal tranches, with
the first tranche of US$200,000 having been received by the Company
(the "First Tranche Funding") and the second tranche of US$200,000
having been dispatched yesterday and expected to be received by the
Company today (the "Second Tranche Funding"). The Subscription
Shares will also be issued, subject to admission to trading on AIM
("Admission"), in two tranches, with the first tranche of
152,321,205 Subscription Shares to be issued on 14 October 2016
(the "First Tranche Shares") and the second tranche of 152,321,205
Subscription Shares to be issued following receipt by the Company
of the Second Tranche Funding (the "Second Tranche Shares") along
with the Commission Shares, the Subscription Warrants and the
Commission Warrants (as described below).
Application has been made to the London Stock Exchange for the
First Tranche Shares, the Second Tranche Shares and the Commission
Shares to be admitted to trading on AIM. It is expected that
Admission will become effective and that dealings in the First
Tranche Shares will commence at 8.00 a.m. on 14 October 2016 and in
the Second Tranche Shares and the Commission Shares at 8.00 a.m. on
or around 18 October 2016.
Following the issue of the abovementioned First Tranche Shares,
the Company's total issued share capital will consist of
1,055,003,129 ordinary shares with voting rights. The Company does
not hold any ordinary shares in treasury and accordingly there are
no voting rights in respect of any treasury shares. The First
Tranche Shares will be fully paid and will rank pari passu in all
respects with the Company's existing ordinary shares.
On Admission of the First Tranche Shares, the above figure of
1,055,003,129 ordinary shares may be used by shareholders in the
Company as the denominator for the calculations by which they will
determine if they are required to notify their interest in, or a
change to their interest in, Sula under the Financial Conduct
Authority's Disclosure and Transparency Rules.
Following the issue of the abovementioned Second Tranche Shares
and the Commission Shares, the Company's total issued share capital
will consist of 1,222,556,454 ordinary shares with voting rights.
The Second Tranche Shares and the Commission Shares will be fully
paid and will rank pari passu in all respects with the Company's
existing ordinary shares.
On Admission of the Second Tranche Shares and the Commission
Shares, the above figure of 1,222,556,454 ordinary shares may be
used by shareholders in the Company as the denominator for the
calculations by which they will determine if they are required to
notify their interest in, or a change to their interest in, Sula
under the Financial Conduct Authority's Disclosure and Transparency
Rules.
The net proceeds of the Subscription will be used by Sula to
advance its Ferensola Gold Project in northern Sierra Leone and for
general working capital purposes.
Proposed Appointment of Directors
Subject to completion of, inter alia, the requisite regulatory
approvals, two representatives of Madini, being Roger Murphy and a
further individual to be nominated by Madini in due course, will
join the board of Sula as directors (the "Proposed Directors").
Roger Murphy has recently joined and invested in Madini.
It is proposed that Roger Murphy will assume the role of Chief
Executive Officer of Sula in place of Sula's Founder, Nick Warrell,
who shall assume the position of the Company's Chief Operating
Officer, and that the second nominee will join the board of Sula as
a Non-Executive Director. A further announcement regarding these
proposed Board changes will be made in due course.
Role of the Proposed Directors and Madini
The Proposed Directors, together with Madini, will be
responsible, along with the existing directors, for advancing the
Company's flagship Ferensola Gold Project through the provision of
strategic and operational advice and by securing funding and/or a
strategic or joint venture partner. The Proposed Directors will
lead Sula's capital markets and financial communications with the
intent of raising Sula's profile amongst investors.
Proposed Grant of Warrants and Options
Subject to receipt of the Second Tranche Funding, Sula will
issue 304,642,410 warrants to MO to subscribe for New Ordinary
Shares at a price of 0.24p per share, exercisable for a period of
five years from the date of grant (the "Subscription
Warrants").
In lieu of any commission payable in cash in relation to the
Subscription, and in addition to the abovementioned Commission
Shares, Sula will also, subject to receipt of the entire
Subscription proceeds, issue 15,232,120 warrants to Madini or its
nominated subsidiary to subscribe for New Ordinary Shares,
exercisable at a price of 0.1p per share for a period of five years
from the date of grant (the "Commission Warrants").
Upon completion of the Subscription, the existing directors of
Sula (the "Current Directors") will be granted options to subscribe
for New Ordinary Shares, as further detailed in the table below
(the "New Current Director Options"):
Current Director Number of New options Total options
existing warrants to be granted and/or warrants
and/or options to the Current held post
held Director grant
------------------ ------------------- ---------------- -----------------
Nick Warrell 15,000,000 25,000,000 40,000,000
------------------ ------------------- ---------------- -----------------
Matt Wood 8,323,691 15,000,000 23,323,691
------------------ ------------------- ---------------- -----------------
Howard Baker 17,000,000 15,000,000 32,000,000
------------------ ------------------- ---------------- -----------------
The New Current Director Options will be exercisable in three
equal tranches, insofar as is possible, at 0.2p, 0.3p and 0.4p per
New Ordinary Share for a period of five years from the date of
grant.
Upon completion of the Subscription and completion of the
appointment of the Proposed Directors, the Proposed Directors will
be granted options to subscribe for New Ordinary Shares, as further
detailed in the table below (the "Proposed Director Options"):
Proposed Director Number of Options to Total options
existing warrants be granted held post
and/or options to the Proposed grant
held Director
------------------- -------------------- ----------------- --------------
Roger Murphy - 15,000,000 15,000,000
------------------- -------------------- ----------------- --------------
Second nominee
of Madini - 5,000,000 5,000,000
------------------- -------------------- ----------------- --------------
The Proposed Director Options will be exercisable in three equal
tranches, insofar as is possible, at 0.2p, 0.3p and 0.4p per New
Ordinary Share for a period of five years from the date of grant.
The Proposed Director Options will be issued directly to Madini or
its nominated subsidiary.
City Code on Takeovers and Mergers (the "City Code")
Under Rule 9 of the City Code (to which Sula is subject), any
person who acquires, whether by a series of transactions over a
period of time or not, an interest in shares of a company which
(when taken together with shares in which any person(s) acting in
concert with him are interested) carry 30 per cent. or more of the
voting rights of that company, or any person, together with persons
acting in concert with him, who is interested in shares which, in
aggregate, carry not less than 30 per cent. of the voting rights of
a company but does not hold shares carrying more than 50 per cent.
of such voting rights, and such person, or any other person acting
in concert with him, acquires an interest in any other shares which
increases the percentage of shares carrying voting rights in which
he is interested, such person will normally be required to make an
offer to the holders of shares in that company to acquire all of
the shares in that company not held by him or persons acting in
concert with him. Such an offer would have to be made in cash, or
be accompanied by a cash alternative, at not less than the highest
price paid for any interest in existing shares by that person or by
any person acting in concert with him within the 12 months prior to
the announcement of such offer.
Following completion of the Subscription, MO will hold, in
aggregate, approximately 26.16 per cent. of the Company's enlarged
share capital. The Proposed Directors are presumed to be acting in
concert with Madini, MO and Ian Schofield, for the purposes of the
City Code (together, the "Concert Party").
Following completion of the Subscription, Madini and Ian
Schofield (via MO and Madini) will be interested, in aggregate, in
19.62 per cent. and 8.35 per cent. respectively of the Company's
then enlarged issued share capital.
If any of the Subscription Warrants, the Commission Warrants or
the Proposed Director Options (together, the "Concert Party
Dilutive Securities") are exercised and satisfied through the issue
of New Ordinary Shares, it is possible that the resulting issue of
New Ordinary Shares would result in the Concert Party's aggregate
shareholding (together with shares in which any other person(s)
deemed by the Takeover Panel to be acting in concert (as defined in
the City Code) with it are interested) being equal to or greater
than 30.0 per cent. of the Company's then enlarged issued share
capital and, pursuant to Rule 9 of the City Code, the Concert Party
would then be obliged to make a mandatory offer in cash (or
accompanied by a cash alternative) for the entire issued ordinary
share capital not held by it (or any person(s) deemed by the
Takeover Panel to be acting in concert with it) at the highest
price paid by the Concert Party (or any person(s) deemed by the
Takeover Panel to be acting in concert with it) for any interest in
ordinary shares acquired in the previous 12 months.
Madini and MO have committed not to exercise their
abovementioned proposed warrants to the extent that it would result
in the Concert Party's aggregate interest in Sula increasing to
30.0 per cent. or more of Sula's issued ordinary share capital. For
illustrative purposes only, if all of the Concert Party Dilutive
Securities were to be exercised, Sula would issue the respective
members of the Concert Party with, in aggregate, 339,874,530 New
Ordinary Shares. Accordingly, for illustrative purposes only, based
on the above, ceteris paribus, the Concert Party would then hold,
in aggregate, 659,749,060 ordinary shares, representing
approximately 42.23 per cent. of the issued share capital as
enlarged by the issue of New Ordinary Shares pursuant to the
exercise of the Concert Party Dilutive Securities and the Concert
Party would then be obliged to make a mandatory offer in cash as
described above.
Update on Joint Venture discussions
In its unaudited consolidated Interim Results for the six months
ended 31 March 2016, Sula announced that it was in advanced
discussions with respect to securing a potential joint venture
partner to assist with the development of its Ferensola Gold
Project. As a result of the transaction with MO, these discussions
have now been terminated.
Adviser warrants
The Company also announces that the exercise price of a warrant
over 3,568,485 shares previously issued to an adviser to the
Company has been amended such that it is now exercisable at a price
of 0.1p per share.
Nick Warrell, Chief Executive Officer of Sula, commented:
"We are extremely pleased with the continued interest our gold
project is generating. We look forward to working with the Proposed
Directors and Madini in advancing the Company's Ferensola Gold
Project and look forward to updating the market with further news
in due course."
Roger Murphy of Madini, commented:
"Madini is delighted to partner with Sula to assist with the
development of its very exciting Ferensola Gold Project in Sierra
Leone. We believe that with the additional skills that we bring to
Sula and our track record of developing African mining projects,
Madini will complement the Sula team enabling us to unlock the
undoubted value of the Ferensola Gold Project."
**ENDS**
The information contained within this announcement is deemed by
the Company to constitute inside information under the Market Abuse
Regulation (EU) No. 596/2014.
For further information please visit www.sulaironandgold.com or
contact the following:
Sula Iron & Gold plc
Nick Warrell / Matt Wood / Howard +44 (0) 20
Baker 7583 8304
Strand Hanson Limited (Financial
and Nominated Adviser)
Simon Raggett / James Harris / +44 (0) 20
James Dance 7409 3494
VSA Capital Limited (Broker) +44 (0) 20
Andrew Raca 3005 5000
For further information on Madini Minerals please visit
www.madiniminerals.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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