Stratmin Global Resources PLC Bass Transaction Update (3489Z)
May 26 2016 - 2:01AM
UK Regulatory
TIDMSTGR
RNS Number : 3489Z
Stratmin Global Resources PLC
26 May 2016
26 May 2016
StratMin Global Resources Plc
("StratMin" or the "Company")
Bass Transaction Update
StratMin Global Resources Plc (AIM: STGR), London's only listed
graphite production and exploration company, notes the announcement
made by Bass Metals Ltd ("Bass") today regarding its proposed
acquisition of the Company's 93.75 per cent. owned subsidiary,
Graphmada Mauritius ("Graphmada"), (the "Proposed Disposal") and is
pleased to report that Bass has now completed due diligence and
that it will proceed with its offer to acquire the 93.75 per cent.
of Graphmada it does not already own. A sale and purchase agreement
is being negotiated in conjunction with the production of a
circular to Stratmin shareholders ("Shareholders") convening a
general meeting of the Company.
The proposed consideration of up to A$15.25 million for the
remaining 93.75 per cent. of Graphmada values the business at
A$16.267 million or approximately GBP8.0 million. This is, in the
Board's opinion, a compelling valuation in comparison with the
current market capitalisation of StratMin.
The consideration for the remaining 93.75 per cent. of issued
shares in Graphmada will be settled as follows, subject to the
satisfaction of a number of conditions precedent including, inter
alia, approval by Shareholders and the raising of the necessary
funds by Bass, on a roadshow shortly to be completed by Bass
(further details on which below), to fund the initial cash payment
as detailed below:
1. A cash payment of A$1,500,000 (approximately GBP735,000), in cash;
2. An equity payment of A$8,750,000 in Bass shares in the following 3 tranches:
a. A$750,000 worth of Bass shares at a price of A$0.01 per share upon execution;
b. A$3,000,000 worth of Bass shares upon achieving production
output of 1,250t of graphite concentrate over three consecutive
months ("Tranche 2"); and
c. A$5,000,000 worth of Bass shares upon achieving production
output of 2,500t of graphite concentrate over three consecutive
months ("Tranche 3").
3. A net smelter royalty of 2.5% capped at A$5,000,000 beginning
six months after execution of the Proposed Disposal.
At the close of trading on the ASX on 25 May 2016, Bass'
mid-market share price was A$0.01.
The Bass shares issued under Tranche 2 and Tranche 3 will be
valued on Bass' volume weighted average share price over the 20
trading days immediately prior to the achievement of the production
milestones.
Bass has engaged Bizzell Capital Partners and Patersons
Securities, two Australian based brokers with significant expertise
in financing graphite projects, to assist with raising funds for
the acquisition of Graphmada.
The Board has considered the Proposed Disposal and the
alternatives for funding the development of operations and believes
that placing funding control under Bass, with operational support
from StratMin and Tirupati, gives Shareholders the best available
development proposition.
The structure of the Proposed Disposal is designed to
accommodate the regulatory requirements of both the Australian and
London markets. As it involves disposal of StratMin's only
significant asset, it is subject to Shareholder approval and will,
unless the Company acquires another sufficiently large asset prior
to the divestment of Graphmada, be classified as a fundamental
change of business for StratMin as defined in the AIM Rules for
Companies. If the Company is unable to acquire a sufficiently large
asset before completion of the Proposed Disposal, StratMin will
have six months to secure another asset or business, failing which
it may be required to apply for readmission to AIM as an Investing
Company.
Stratmin intends to shortly send a circular to Shareholders
detailing the Proposed Transaction and convening a general meeting
of the Company to seek the required Shareholder approvals, in
accordance with the AIM Rules for Companies.
The Board has been pursuing a number of corporate opportunities
and is confident that it will be able to complete a transaction
within the six months following completion of the Proposal Disposal
and maintain the admission of its ordinary shares to trading on the
AIM Market.
For further information please visit www.stratminglobal.com or
contact:
StratMin Global Resources Plc +44 (0) 20
Brett Boynton, CEO 3691 6160
Strand Hanson (Nominated & Financial
Adviser) +44 (0) 20
Rory Murphy / Ritchie Balmer 7409 3494
Beaufort Securities (Broker) +44 (0) 20
Jon Bellis 7382 8300
Optiva Securities (Broker) +44 (0) 20
Christian Dennis 3137 1903
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCAKADNQBKKBPB
(END) Dow Jones Newswires
May 26, 2016 02:01 ET (06:01 GMT)
Stratmin Global (LSE:STGR)
Historical Stock Chart
From Jun 2024 to Jul 2024
Stratmin Global (LSE:STGR)
Historical Stock Chart
From Jul 2023 to Jul 2024