TIDMSAV
RNS Number : 7529K
Savannah Resources PLC
26 September 2016
Savannah Resources Plc / Index: AIM / Epic: SAV / Sector:
Mining
26 September 2016
Savannah Resources Plc
Cash Placing and Subscription of GBP1.42 million
Letters of Intent for further GBP0.83 million cash investment
from Al Marjan and Directors
Savannah Resources plc (AIM: SAV) ('Savannah' or 'the Company'),
the AIM quoted resource development company, announces that it has
raised approximately GBP1.42 million (before expenses) through the
placing ('Placing') of 28,208,973 new ordinary shares ('Placing
Shares') and subscription ('Subscription') for 12,500,000 new
ordinary shares ('Subscription Shares') at a placing price of 3.5p
per ordinary share (the 'Placing Price') with both new and existing
investors. Beaufort Securities acted as broker to the Placing,
which was significantly oversubscribed.
HIGHLIGHTS:
-- Raised gross proceeds of GBP1.42 million cash
-- Funds to be used predominately to support the development of
Savannah's copper projects in Oman, with mining targeted to
commence in late 2017, and for working capital purposes at its
newly acquired lithium projects in Finland
-- Letters of intent received for additional GBP0.83m cash from
Directors and their related parties (Al Marjan Ltd) for when the
Company has exited its current "close period"
David Archer, Savannah's Chief Executive Officer said today,
"This significantly oversubscribed placing of GBP1.42 million
demonstrates the support we are receiving from new and existing
shareholders in our strategy to bring our copper projects in Oman
to production late next year, pursuing our projects in Mozambique
as well as unlocking the potential of our exciting new lithium
projects in Finland.
"We recently announced that we have applied for mining licences
in Oman for our Mahab 4 and Maqail South Deposits in Block 5, and
following this significant milestone we are now looking forward to
receiving an updated Mineral Resource in Q4, which we hope will
further improve our current Indicated and Inferred Mineral Resource
of 1.7Mt at 2.2% copper as a result of our recent intensive drill
programme. Further updates will be made to the market as we
progress towards the mine development stage."
Details of Placing and Subscription and Letters of Intent
The Company will have a pro-forma cash balance of GBP1.8 million
following the receipt of the Placing and Subscription proceeds of
GBP1.42 million. The Company, which is currently in a "close
period" that restricts Directors' trading in the Company's shares,
has received letters of intent in respect of investing on the same
terms (this is consistent with the Relationship Agreement between
the Company and Al Marjan) as the Placing and Subscription once the
Company has exited the "close period". Specifically:
-- Al Marjan Ltd the Company's largest shareholder intend to
maintain its shareholding of 29.99% with a subscription of GBP
685,370 cash;
-- the Company's CEO, David Archer intends to maintain his
shareholding of 5.7696% with a subscription of GBP129,816 cash;
and
-- the Company's Chairman, Matthew King, intends to subscribe
for GBP10,000 worth of shares in cash.
This would potentially result in further gross cash proceeds of
GBP825,186 if these letters of intent are subsequently acted
upon.
The net proceeds of the Placing and Subscription will be used by
the Group to fund work on its Oman Copper-Gold Project to help
deliver Mineral Resource updates, licencing documents, and a
scoping study, to pursue its projects in Mozambique, to define
drill targets at its lithium projects in Finland as well as for
general working capital purposes to support the Company.
Application will be made for the Placing and Subscription
Shares, which will rank pari passu with the existing ordinary
shares in the Company, to be admitted to trading on AIM
('Admission'). It is expected that Admission will become effective
and dealings will commence at 8.00 a.m. on 30 September 2016.
Following Admission the total issued share capital will consist
of 425,869,714 ordinary shares. As such the total number of voting
rights in the Company will be 425,869,714 ordinary shares. This
number may be used by shareholders 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, the
Company under the FCA's Disclosure and Transparency Rules.
The Company will issue 1,410,449 share options to Beaufort
Securities in connection with the Placing. The exercise price for
these share options is 5.0p per share, they have an exercise period
limited to three years and they vest immediately
This announcement contains inside information for the purposes
of Article 7 of Regulation (EU) 596/2014.
**ENDS**
For further information please visit www.savannahresources.com
or contact:
David Archer Savannah Resources Tel: +44 20
plc 7117 2489
David Hignell / Gerry Northland Capital Tel: +44 20
Beaney (Nominated Partners Ltd 3861 6625
Adviser)
Jon Belliss / Elliot Beaufort Securities Tel: +44 20
Hance Ltd 7382 8300
(Corporate Broker)
Charlotte Page / St Brides Partners Tel: +44 20
Lottie Brocklehurst Ltd 7236 1177
Notes
Savannah Resources Plc (AIM: SAV) is a growth oriented,
multi-commodity, development company.
Oman
Savannah has interests in two copper blocks in the highly
prospective Semail Ophiolite Belt in Oman. The projects, which have
an Indicated and Inferred Mineral Resource of 1.7Mt at a grade of
2.2% copper and high grade intercepts of up to 56.35m at a grade of
6.21% Cu, with additional gold upside potential, provide Savannah
with an excellent opportunity to potentially evolve into a mid-tier
copper and gold producer in a relatively short time frame. Together
with its Omani partners, Savannah aims to outline further mineral
resources to provide the critical mass for a central operating
plant to develop the deposits, and in December 2015 outlined
exploration targets of between 10,700,000 and 29,250,000 tonnes
grading between 1.4% and 2.4% copper.
Mozambique
Savannah has agreed to acquire 100% of Matilda Minerals Limitada
which currently operates the Jangamo exploration project, and has
agreed with Rio Tinto to form a joint venture in Mozambique to
develop the combined Mutamba/Jangamo Project. Formation of the
joint venture remains subject to approval by the Ministry of
Mineral Resources and Energy of the Republic of Mozambique. Jangamo
has a 65Mt Inferred Mineral Resource at a grade of 4.2% total heavy
minerals ("THM") at a 2.5% cut-off grade. The Mutamba, Dongane and
Chilubane deposits have a combined exploration target of 7-12Bn
tonnes at a grade of 3-4.5% THM (published in 2008).
Finland
Savannah has Reservation Permits over two new lithium projects,
Somero and Erajarvi, covering an area of 159km(2) in Finland.
Savannah holds a 100% interest in these projects through its
Finnish subsidiary Finkallio Oy. Geological mapping by the Finnish
Government within the project areas has highlighted the presence of
lithium minerals spodumene, lepidolite and petalite with the
Government also identifying Somero and Erajarvi as one of the most
prospective areas to discover lithium deposits in Finland. Savannah
plans to initiate an exploration programme including data
compilation, geological mapping and surface sampling with the aim
of generating drill ready targets during 2016.
This information is provided by RNS
The company news service from the London Stock Exchange
END
ROIBRGDCXSDBGLU
(END) Dow Jones Newswires
September 26, 2016 02:00 ET (06:00 GMT)