TIDMAVM
RNS Number : 0893P
Avocet Mining PLC
14 August 2014
Placing of Shares
Highlights
-- GBP0.7 million (approximately US$1.2 million) to be raised by
way of a Placing of 9,950,000 new ordinary shares ("Shares") with
existing investors at a price of 7.13 pence per share
-- The Issue Price of 7.13 pence per share represents a discount
of 5 % to the closing price of 7.51 pence per share on 13 August
2014
-- Elliott , as Avocet's largest shareholder, subscribed for
2,550,000 shares, representing approximately 26% of the total
placing, resulting in a post-placing shareholding of 27.69% in the
Company
-- Prelas AS, as Avocet's second largest shareholder, subscribed
for 4,950,000 shares, representing approximately 50% of the total
placing, resulting in a post-placing shareholding of 6.87% in the
Company
-- The funds raised from the Placing to be used wholly for
corporate activities, primarily in London and Guinea
David Cather, Chief Executive of Avocet, commented:
"As we announced last week, steps have been taken to address the
funding requirements of Inata, where production is forecast to
increase following commissioning of the carbon blinding circuit
next month. The share placing announced today will provide funding
for our head office activities while we continue to address the
wider Group's funding situation, and while the business review
continues. The placing ensures that cash flows at Inata can be used
exclusively for key items of capex and operating expenditure during
the lead up to the commissioning of the carbon blinding circuit.
While the placing demonstrates the support of our largest investors
we remain fully committed to resolving the ongoing financing issues
of the Group, through further cost reduction measures, continued
negotiations with existing and potential sources of finance, and
the completion of our business review."
The placing
Avocet Mining PLC ("Avocet" or the "Company") announces that it
has conditionally raised GBP0.7 million before expenses by the
placing of 9,950,000 new ordinary shares in the Company (the
"Placing Shares") at a price of 7.13 pence per Placing Share (the
"Placing"). The Placing Shares being issued represent approximately
5% of the Company's issued ordinary share capital prior to the
Placing.
The placing funds will be used for corporate activities.
Following commissioning of Inata's new carbon blinding circuit,
which is scheduled in September and is forecast to increase monthly
production and improve cash generation, the Company will assess the
extent to which this will enable Inata to contribute to funding
these activities going forward. In the event that no funds were
available from Inata for corporate purposes, it is estimated that
the placing funds, together with existing corporate cash, would be
sufficient for head office and Guinea purposes for approximately
four months, while efforts continue to address the wider Group's
funding situation, and while the business review continues.
Elliott, which had a shareholding of 27.80% in Avocet prior to
the placing, subscribed for 2,550,000 Placing Shares for a total
consideration of GBP181,815. As a result of its 27.80% shareholding
in Avocet, the placing of shares with Elliott constitutes a related
party transaction, under Chapter 11.1.5R of the UKLA Listing Rules
("LRs"). In particular, the placing of shares with Elliott is
classified as a smaller related party transaction under LR 11.1.10
R.
The Placing Shares will, when issued, be issued credited as
fully paid and will rank pari passu in all respects with the
existing ordinary shares of 5 pence in the capital of Avocet,
including the right to receive all dividends and other
distributions declared after the date of the issue.
Application will be made for the Placing Shares to be admitted
to the premium listing segment of the Official List of the
Financial Conduct Authority and to be admitted to trading by the
London Stock Exchange ("LSE") on its main market for listed
securities (the "Admission"). It is expected that Admission will
take place at 8.00 a.m. on 19 August 2014 (at which time the
Placing will become unconditional) and that dealings in the Placing
Shares on the LSE's main market and on Oslo Bors for listed
securities will commence at the same time. Following Admission,
there will be 209,496,710 Ordinary Shares in issue, including
442,009 treasury shares.
Beneficial interests in 7,400,000 of the Placing Shares (the
"Norwegian Placing Shares") are expected to be issued and
registered in the Norwegian Central Securities Depository ("VPS")
with a view to being admitted to trading on the Oslo Stock Exchange
on 19 August 2014. The Norwegian Placing Shares will not be
tradable on the Oslo Stock Exchange until they have been issued and
registered in VPS.
The Placing is conditional upon, inter alia, Admission becoming
effective by 8.00 a.m. on 19 August 2014.
FOR FURTHER INFORMATION PLEASE CONTACT
Avocet Mining Bell Pottinger J.P. Morgan NM Rothschild Investec
PLC Financial Cazenove Financial Bank Plc
PR Consultants Corporate Adviser Financial
Broker Adviser
David Cather, Daniel Thöle Michael Wentworth-Stanley Roger Ewart-Smith Jeremy Wrathall
CEO Sam Critchlow
Mike Norris,
FD
Jim Wynn,
Company Secretary
+44 020 3709 +44 20 7861 +44 20 7742 +44 20 7280 +44 20 7597
2570 3800 4000 5424 4180
NOTES TO EDITORS
Avocet Mining PLC ('Avocet' or the 'Company') is an unhedged
gold mining and exploration company listed on the London Stock
Exchange (ticker: AVM.L) and the Oslo Børs (ticker: AVM.OL). The
Company's principal activities are gold mining and exploration in
West Africa.
In Burkina Faso the Company owns 90% of the Inata Gold Mine.
Across the Bélahouro district, which includes both Inata and Souma,
there is a Mineral Resource of 6.1 million ounces and an Ore
Reserve of 0.5 million ounces. The Inata Gold Mine poured its first
gold in December 2009 and produced 118,443 ounces of gold in 2013.
Other assets in Burkina Faso include eight exploration permits
surrounding the Inata Gold Mine in the broader Bélahouro region.
The most advanced of these projects is Souma, some 20 kilometres
from the Inata Gold Mine, where there is a Mineral Resource
estimate of 0.8 million ounces.
In Guinea, Avocet owns 100% of the Tri-K Project in the north
east of the country. Drilling to date has outlined a Mineral
Resource of 3.0 million ounces, and in October 2013 the Company
announced a maiden Ore Reserve on the oxide portion of the orebody,
which is suitable for heap leaching, of 0.5 million ounces. As an
alternative, the potential exists to exploit the entire 3.0 million
ounce Tri-K orebody via CIL processing method.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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