TIDMKIBO
RNS Number : 8963C
Kibo Mining Plc
08 May 2012
DETAILED CAUTIONARY ANNOUNCEMENT
Shareholders are advised that the Company has entered into
negotiations as more fully explained below, which if successfully
concluded may have a material effect on the price of the Company's
securities. Accordingly, shareholders are advised to exercise
caution when dealing in the Company's securities until a full
announcement is made.
Strategic Joint Venture proposed on Haneti Nickel Project
-- Kibo signs Memorandum of Understanding to pursue a strategic
joint venture with Brazilian industrial conglomerate Votorantim for
the further exploration of its Haneti properties.
Dated: 08 May 2012
Kibo Mining plc ("Kibo" or the "Company") (AIM: KIBO), (JSE:
KBO), the Tanzania focused mineral exploration and development
company, is pleased to advise that it has agreed to record a
Memorandum of Understanding ("MOU") with Brazilian VOTORANTIM
METAIS PARTICIPACOES LTDA, a member of Votorantim Group,
("Votorantim") to pursue negotiations forthwith with a view to
entering into a definitive joint venture agreement in respect of
its Haneti properties ("Haneti") prospective for nickel and other
base and precious metals as soon as practicable (the "Joint
Venture").
Proposed Transaction Framework
The Joint Venture, if concluded and implemented, would see
Votorantim initially contributing exploration expenditures of GBP
0,5 million until December 2013. The earn-in phase comprises total
investments up to GBP 2,7 million during a period of 3 years in an
mutually agreed work program budget on Haneti to earn a 50%
interest (the "Initial Period"), where after the parties will
continue to contribute equally to the Joint Venture.
During the first stage of the program, the Joint Venture will be
unincorporated and the Company will be the operator of the Joint
Venture and its exploration work program. Votorantim will however
have an option to take over the management of the work program and
call for the transfer of the Haneti properties to a joint venture
company ("Newco") that will be owned equally by the Company and
Votorantim. Votorantim shall be entitled to operate the Joint
Venture from 31 December 2013 until the end of the Initial Period,
where after the board of directors of Newco shall appoint the
operator.
It is the intention of the parties to direct the work program
towards establishing a JORC compliant mineral resource at Haneti
during the Initial Period, where after the Joint Venture will
consider the further development of the project on the merits of
the exploration results achieved.
About Votorantim
Votorantim is one of the largest corporate conglomerates in
Latin America, with a 94-year history. Votorantim Group's
activities are focused on key sectors of the economy that demand
capital intensive and high scale production processes such as
cement, mining and metallurgy (aluminum, zinc and nickel), steel
mill, pulp, concentrated orange juice, and energy self-generation.
In the financial market, the Group trades through Votorantim
Finance and, through its New Business segment, we operate with a
Venture Capital and Private Equity fund. In 2011, the Company's net
revenues totaled R$ 23.7 billion, of which R$ 5.8 billion consists
of exports. Cash generation (EBITDA) amounted to R$ 5.3 billion,
whilst investments reached R$ 4.3 billion in operating improvement
and expansion. Votorantim Industrial is rated Investment Grade by
the three major rating agencies in the world - Standar &
Poor's, Fitch Ratings and Moody's. In March 2012 Fitch Ratings
upgraded the foreign and local currency ratings of Votorantim to
"BBB". This recognition is due to Votorantim's leadership in the
markets it serves, its management model, governance policies and
transparency.
Rationale
Commenting on the MOU, Kibo CEO Louis Coetzee said:
"In the announcement of the Company's strategic acquisitions of
Tanzanian energy assets Mzuri Energy Limited and Mayborn Resources
(Pty) Ltd on 2 April 2012 it was pointed out that Tanzania as an
African investment destination is, in our opinion, steadily moving
up the priority ladder of a number of major international
industrial groups in Asia and the Americas. Votorantim's decision
to make Tanzania one of the countries into which it invests its
considerable resources of capital and skills would support this
view.
This is an ideal opportunity for Kibo to develop a close working
relationship with our colleagues at Votorantim in the base metals
space to the benefit of our respective shareholders and the people
of Tanzania. This step represents the next natural development in
the broader strategy of the Company to build a multi-commodity
exploration platform comprising more advanced exploration projects
that can be taken more swiftly up the value curve by collaborating
with respected industry veterans with a proven understanding of
their chosen fields of operation.
We expect to continue developing this progressive approach to
our business over time"
Enquiries:
Louis Coetzee +27 (0)83 2606126 Kibo Mining Chief Executive
plc Officer
John Simpson +44 (0) 161 Zeus Capital Nominated Adviser
831 1512 Limited
Andreas Lianos +27 (0)83 4408365 River Group Corporate Adviser
and Designated Adviser
(AltX)
Nick Bealer +44 (0)207 7109612 Cornhill Capital Broker (Corporate
Ltd Broking)
Matt Beale +44 (0)7966 Fortbridge Public Relations
389196
Updates on the Company's activities are regularly posted on its
website www.kibomining.com
General Background & Strategy
Kibo is a public company registered in Ireland (company number
451931). Its registered office is Kibo Mining plc, Suite 3, One
Earlsfort Centre, Lower Hatch Street, Dublin 2, Ireland. Kibo was
established in early 2008 to explore and develop mineral deposits
in Tanzania, East Africa and was admitted to AIM on 27 April 2010
and AltX in South Africa on 30 May 2011.
The Board of Kibo is composed of experienced professionals
spanning mineral exploration, mine development, mining finance and
financial control of public companies. It is supported by well
trained and motivated Tanzanian staff that operates from Kibo's
exploration offices in Dar es Salaam and Mwanza.
The mineral assets of the Company comprise three existing and
two newly acquired projects in Tanzania - Haneti (nickel, platinoid
elements and gold), Morogoro (Gold) and Lake Victoria (Gold) which
give Kibo access to over 18,000 km(2) of early stage exploration
licences in Tanzania's premier gold mining region, the Lake
Victoria Goldfield and within the newly emerging gold exploration
regions in eastern Tanzania.
The Company has recently also acquired, subject to certain
suspensive closing conditions and approvals, coal and uranium
exploration projects as publicly announced on 2 April 2012 in
accordance with its multi-commodity exploration strategy.
Kibo's objective is to enhance Shareholder value through
acquisition, exploration and development of mineral assets in
Tanzania. This objective will be pursued primarily through active
exploration, particularly drilling on its current projects and by
using the Company's experience in Tanzania to acquire further
quality mineral projects on competitive terms that can be quickly
evaluated and taken to the next stage of development. Kibo will
undertake continual risk assessment of its projects and take
whatever actions it believes are necessary to ensure that these
risks are mitigated.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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