Bluebird Merchant Ventures Limited Funding Update (8968N)
26 May 2020 - 4:01PM
UK Regulatory
TIDMBMV
RNS Number : 8968N
Bluebird Merchant Ventures Limited
26 May 2020
Bluebird Merchant Ventures Ltd
(the " Company" or " Bluebird")
Funding Update
Bluebird Merchant Ventures (EPIC: BMV), the Korean focused gold
development group is pleased to announce an update with regards to
funding the South Korean projects to production.
On 26 March 2020 the Company announced that it had "entered into
a legally binding agreement with a South Korean company in respect
of non-dilutive funding to bring about gold production in South
Korea" and further that the "agreement creates a path to provide
USD 5 million of debt finance that will be repaid from future gold
production". The Company is pleased to report that the South Korean
company has successfully completed its due diligence and has
advanced to the point at which financing terms will be confirmed
shortly. The financing, if successful, is expected to be received
by the end of July. Whilst the Company remains optimistic for a
successful conclusion to the funding path there can be no guarantee
of such.
Upon receipt of funding, the South Korean projects will progress
to production as announced previously on 17 December 2019 with
initial mining commencing in 6 months and gold production some 3
months later. Both mines will continue to expand their mining area
and build up inventory whilst the process plant design is completed
and constructed. The estimated average cash cost per ounce (C1
level) is USD 576 per ounce. This is based on both mines over the
initial 3 years of production. The cost of the initial production
phase to the joint venture is USD 2.2 million with the Company
being responsible for 50% of the joint venture costs. Over a 3 year
period gold production will largely grow organically from 10,000 to
30,000 ounces per annum. A further USD 7 million of capital will be
injected during this period, however the bulk of this will be
contributed from cash flow from production.
Exercise of Warrants
The Company has received a notice of exercise of a warrant over
3,846,153 new ordinary shares of the Company at a price of 1.3
pence per share ("Warrant Shares"). The Warrant Shares relate to
the announcement on 26 March 2020 and the proceeds of GBP50,000
have been applied towards the repayment of the loan amount of
GBP200,000 that was announced on 26 March 2020.
Issue of Equity
T he Company has issued 1,200,000 new ordinary shares of the
Company at a price of 3.742 pence per share ("Fee Shares"). The Fee
Shares have been issued in lieu of cash fees due to an adviser with
a notional value of GBP44,904.
The Company has issued 1,851,919 new ordinary shares of the
Company at a price of 2.5 pence per share and 1,164,517 new
ordinary shares of the Company at a price of 2.5017 pence per share
("Loan Conversion Shares"). The Loan Conversion Shares relate to an
outstanding loan amount of US$ 57,178 that was announced on 10
April 2017 and GBP29,133 of short term loan funding that was
received in the fourth quarter of 2019.
The Warrant Shares, Fee Shares and Loan Conversion Shares rank
pari passu with the Company's existing issued ordinary shares and
application will be made for the Warrant Shares, Fee Shares and
Loan Conversion Shares to be admitted to the Main Market of the
London Stock Exchange.
The Company's issued ordinary share capital, as enlarged by the
share issuance will be 381,925,179 ordinary shares. This figure of
381,925,179 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 in their interest in, the share capital of the Company under
the FCA's Disclosure and Transparency Rules.
The Directors note that the Issue of Equity substantially
improves the balance sheet of the Company as it progresses towards
production in South Korea.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES
OF ARTICLE 7 OF THE MARKET ABUSE REGULATION EU 596/2014
("MAR").
Enquiries:
Bluebird Merchant Ventures Ltd jmk@bluebirdmv.com
Jonathan Morley-Kirk, Non-Executive
Chairman
Notes to Editors
The Gubong mine was once the second largest producing gold mine
in South Korea until its closure in 1971 when gold prices were
US$40 per ounce. The mine consists of nine shallow dipping stacked
veins. Although production was mainly from vein number six, five
other veins were mined from 1928 until its closure. Over 17,000
metres of drilling was carried out over the years and there are
over 120 kilometres of existing underground development.
The Kochang mine is a gold-silver mine that operated between
1928 and 1975 and produced over five million ounces of silver at
over 1,000 g/t and 110,000 ounces of gold at 19.6 g/t. This gold
production was mainly derived from the three main veins at the
North East end of the " Gold Mine " part of Kochang, with the
majority of the silver production from the " Silver Mine " some 2.5
kilometres to the south west. The mine closed in 1975 when the gold
price was USD 140 per ounce. Today the mine consists of three
steeply dipping veins. Bluebird has opened up three kilometres of
original development, taken over 400 samples and has confirmed
process viability by carrying out initial metallurgical test
work.
This information is provided by RNS, the news service of the
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END
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