PRESS RELEASE 24 JANUARY 2012
SERABI GOLD plc ("Serabi" or "the Company")
Placing of 27,300,000 Units to raise £2.73 million at a price of 10.0 pence per Unit
Summary
Serabi Gold plc (AIM:SRB, TSX:SBI and SBI.WT), the
Brazilian-focused gold exploration Company, is pleased to
announce that it has conditionally placed ("the Placing")
27,300,000 Units at a price of 10.0 pence per Unit (the
"Placing Price"). Each Unit comprises one new Ordinary Share
of 5.0 pence each and one sixth of a share purchase warrant
whereby each whole warrant (a "Warrant") entitles the holder
to subscribe for one new Ordinary Share at a price of 15.0
pence at any time for a period of two years expiring 23
January 2014. The new Ordinary Shares issued pursuant to the
Placing (the "Placing Shares") represent 29.9% of the
enlarged share capital of the Company. The Placing is
conditional on the new Ordinary Shares being admitted to
trading on the TSX and AIM. Application has been made to both
the TSX and AIM for the new Ordinary Shares to be admitted to
trading.
Dealings on AIM in the new Ordinary Shares are expected to
commence at 8.00 am on 31 January
2012. Ordinary Shares that have been subscribed for by
purchasers resident in Canada are subject to a four month
hold period under applicable Canadian securities laws. The
new Ordinary Shares will when issued and fully paid, rank in
all other respects pari passu with the existing Ordinary
Shares in issue including the right to receive all dividends
and other distributions declared, made or paid after the date
of their issue.
The Company has pursued its stated objective of organic
resource growth over the last 18 months and the Board has
been pleased with the exploration success the Company has
achieved during this period. As recently announced, the
Company has made two discoveries from the initial nine mine
site targets at its Jardim do Ouro project which incorporates
the existing Palito deposit and process plant. In addition,
final analytical results from shallow extension drilling on
the south-eastern strike extension of the Palito deposit have
returned "Bonanza" grade gold and high grade copper results
(as announced on 24
November 2011 and 24 January 2012). The Board is encouraged
both by these new potential targets for resources and the
continued strong gold price (which has more than doubled
since the Palito Operation
was placed on care and maintenance in late 2008).
Accordingly, given that the Company has maintained
its current production licences and process plant at Palito,
the Board has decided to commission a Preliminary Economic
Assessment ("PEA") of the viability of recommencing
underground operations at Palito. The study will focus
initially on the existing resources before embarking on the
next stage of evaluation and exploration activity. The PEA
study will consider a selective mining methodology, focused
on maximising grade and initially limited to production
levels around 20,000 ounces per annum. With improved gold
prices and a return to selective high grade mining rather
than returning to bulk mining methods, initial internal
assessments demonstrate potentially attractive returns.
Furthermore, the Palito plant can accommodate considerably
more capacity than the initial throughputs being considered,
and the general development of the region and elevated gold
prices have in turn generated additional nearby high grade
gold feed opportunities potentially available for processing
at Palito. The Company is therefore considering additional
opportunities which can enhance throughputs at Palito.
The Company has conditionally placed 27,300,000 Units at a price of 10.0 pence per Unit with a number of existing and new institutional investors resulting in the issue of 27,300,000 new Ordinary Shares and
SERABI GOLD PLC2nd Floor, 30-32 Ludgate Hill, London EC4M 7DR This document is not intended to and does t +44 (0)20 7246 6830 f +44 (0)20 7246 6831 e contact@serabimining.com www.serabigold.com not amount to an invitation or inducement to Registered Office 66 Lincoln's Inn Fields, London, WC2A 3LH Company Number 5131528 subscribe for shares in Serabi Gold plc
PRESS RELEASE 24 JANUARY 2012
SERABI GOLD plc ("Serabi" or "the Company")
4,549,998 Warrants. The proceeds of the Placing (which amount
to £2.73 million before estimated expenses of £30,000) will
be used for general working capital and to fund the expenses
associated with the PEA. A total of 13,625,000 Units have
been subscribed for by Fratelli Investments Limited
("Fratelli") as a result of which Fratelli has acquired
13,625,000 new Ordinary Shares representing 14.9% of the
enlarged share capital of the Company. Following the placing
Fratelli has a total interest in the share capital of the
Company of 17,616,000 Ordinary Shares representing 19.30% of
the enlarged share capital of the Company. Fratelli is a
private investment company managed by Megeve Investments
which is the family office of the Chilean family Solari
Donaggio. The Solari Donaggio family has significant business
interests in Chile and other parts of South America. They are
significant shareholders in the Falabella retail group, the
second largest retail chain in South America and have
interests in a variety of other sectors including mining,
energy and real estate. The subscription agreement also
entitles Fratelli to nominate a Director to the Board of the
Company for so long as Fratelli continues to own 15 per cent.
or more of the issued share capital of the Company. The
Company has also entered into an option agreement with
Fratelli entitling Fratelli to subscribe for such number of
new Ordinary Shares as would enable Fratelli to maintain its
percentage interest in the share capital of the Company in
the event that the Company issues new Ordinary Shares for
cash (or cash equivalent). The option agreement ceases
immediately upon Fratelli holding less than 15 per cent. of
the issued Ordinary Shares of the Company.
In addition, Fratelli has entered into an orderly market
agreement with the Company and Beaumont Cornish Limited, in
which Fratelli has agreed that it will not dispose of any
Ordinary Shares for a period of one year following admission,
subject to certain exemptions.
As announced on 16 June 2010, the Company granted an option
to Eldorado Gold Corporation ("Eldorado") entitling Eldorado
to subscribe for such number of new Ordinary Shares as would
enable Eldorado to maintain its percentage interest in the
Ordinary Share capital of the Company in the event that the
Company issued further Ordinary Shares for cash, provided
that Eldorado owned 15 per cent. or more of the issued
Ordinary Share capital at that time (the "Option"). Eldorado,
which is currently interested in 26.3 per cent. of the issued
share capital, has exercised its rights pursuant to the
Option and has conditionally subscribed for 4,500,000 new
Ordinary Shares at the Placing Price. Eldorado waived its
rights granted under the Option to participate to the full
extent possible in the Placing to facilitate the
subscriptions of other parties. In recognition of this the
Board has varied the terms of the Option such that at the
time of the next issue of new Ordinary Shares for cash as
contemplated by the Option, Eldorado would be entitled to
take such share of new Ordinary Shares issued at that time as
would allow them to restore their interest to 26.3 per cent
(subject to any adjustments as set out in the Option), of the
issued share capital at that time.
Greenwood Investments Limited ("Greenwood"), which is
currently interested in 18.1 per cent. of the issued share
capital, has also conditionally subscribed for 5,625,000 new
Ordinary Shares at the Placing Price. Mr Christopher
Kingsman, a Director of Serabi, is the sole shareholder of
Greenwood.
As Eldorado and Greenwood are each interested in more than 10
per cent. of the issued Ordinary Share capital of the
Company, the subscription by each of Eldorado and Greenwood
and the variation of the Eldorado Option are related party
transactions for the purposes of Rule 13 of the AIM Rules.
For the purposes of the AIM Rules, the independent Directors
(being the Board excluding Mr Christopher Kingsman) of
Serabi, having consulted with the Company's nominated
adviser, consider that the subscription by Eldorado and
Greenwood pursuant to the Placing and the variation of the
Eldorado Option are fair and reasonable insofar as the
Shareholders are concerned. The independent Directors have
taken into account in particular that Eldorado and Greenwood
are each subscribing on the same terms and conditions as the
other subscribers for new Ordinary Shares procured by the
Company from unconnected parties.
2nd Floor, 30-32 Ludgate Hill, London EC4M 7DR This document is not intended to and does t +44 (0)20 7246 6830 f +44 (0)20 7246 6831 e contact@serabimining.com www.serabigold.com not amount to an invitation or inducement to Registered Office 66 Lincoln's Inn Fields, London, WC2A 3LH Company Number 5131528 subscribe for shares in Serabi Gold plc
PRESS RELEASE 24 JANUARY 2012
SERABI GOLD plc ("Serabi" or "the Company")
Following completion of the Placing the enlarged issued share capital will comprise 91,268,529 Ordinary Shares. The following table sets out the interest of the major shareholders (to the best knowledge of the Company(1)) following the Placing:
Shareholder | Shares held prior to the Placing | % Interest prior to the Placing | Shares subscribed for under the Placing | Shares held following the Placing | % interest following the Placing |
Fratelli | 3,991,000 | 6.24% | 13,625,000 | 17,616,000 | 19.30% |
Investments | |||||
Limited | |||||
Eldorado Gold | 16,840,000 | 26.33% | 4,500,000 | 21,340,000 | 23.38% |
Corp. | |||||
Greenwood | 11,590,000 | 18.12% | 5,625,000 | 17,215,000 | 18.86% |
Investments | |||||
Limited | |||||
Foreign & | 3,438,957 | 5.37% | - | 3,438,957 | 3.77% |
Colonial |
Investments
(1) At this time none of the above parties have provided the Company with a formal notice of their beneficial interests pursuant to s793 of the Companies Act 2006.
Mr Michael Hodgson, the Chief Executive of Serabi,
commented:
"The latter part of 2011 has been a difficult market for
junior mining companies and we are very pleased to welcome
Fratelli as a significant investor in the Company alongside
the continuing support of both Eldorado and Greenwood."
Enquiries
SERABI GOLD plc
Michael Hodgson t +44 (0)20 7246 6830Chief Executive m +44 (0)7799 473621
Clive Line t +44 (0)20 7246 6830Finance Director m +44 (0)7710 151692
e contact@serabigold.com www.serabigold.com
BEAUMONT CORNISH Limited
Nominated AdviserRoland Cornish t +44 (0)20 7628 3396
Michael Cornish t +44 (0)20 7628 3396
FOX DAVIES CAPITAL Ltd
UK Broker SERABI GOLD PLC2nd Floor, 30-32 Ludgate Hill, London EC4M 7DR This document is not intended to and does t +44 (0)20 7246 6830 f +44 (0)20 7246 6831 e contact@serabimining.com www.serabigold.com not amount to an invitation or inducement to Registered Office 66 Lincoln's Inn Fields, London, WC2A 3LH Company Number 5131528 subscribe for shares in Serabi Gold plc
Simon Leathers t +44 (0)20 3463 5010
Jonathan Evans t +44 (0)20 3463 5010
Copies of this release are available from the Company's website at www.serabigold.com and www.serabimining.com Forward-looking statementsThis press release contains forward-looking statements. All statements, other than of historical fact, that address activities, events or developments that the Company believes, expects or anticipates will or may occur in the future (including, without limitation, statements regarding the estimation of mineral resources, exploration results, potential mineralization, potential mineral resources and mineral reserves) are forward-looking statements. Forward-looking statements are often identifiable by the use of words such as "anticipate", "believe", "plan", may", "could", "would", "might" or "will", "estimates", "expect", "intend", "budget", "scheduled", "forecasts" and similar expressions or variations (including negative variations) of such words and phrases. Forward-looking statements are subject to a number of risks and uncertainties, many of differ materially from those discussed in the forward-looking statements. Factors that could cause actual results or events to differ materially from current expectations include, among other things, without limitation, failure to establish estimated mineral resources, the possibility that future exploration results will not be consistent with the Company's expectations, the price of gold and other risks identified in the Company's most recent annual information form filed with the Canadian securities regulatory authorities on SEDAR.com. Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward- looking statement.
Qualified Persons StatementThe information contained within this announcement has been reviewed and verified by Michael Hodgson, CEO of the Company. Mr Hodgson is an Economic Geologist by training with over 25 years' experience in the mining industry. He holds a BSc (Hons) Geology, University of London, a MSc Mining Geology, University of Leicester and is a Fellow of the Institute of Materials, Minerals and Mining and a Chartered Engineer of the
Engineering Council of UK, recognizing him as both a Qualified Person for the purposes of
Canadian National Instrument 43-101 and by the AIM Guidance Note on Mining. Oil and
Gas Companies dated March 2006.
Quality Assurance and Quality Control Procedures DisclosureThe Company has implemented and maintains a Serabi quality assurance/quality control (QA/QC) protocol at its JDO Project as defined in its "NI 43-101 Technical Report for the Jardim Do Ouro Project, Para State, Brazil" dated 22 December 2010. This ensures best industry practice in sampling and analysis of exploration and resource definition samples. The insertion of field duplicates, certified standards and blank samples into the sample stream form part of the Serabi procedure (these act as an independent check on contamination, precision and accuracy in the analytical laboratory).
Assay results are reported once rigorous QAQC procedures have been approved
Neither the Toronto Stock Exchange, nor any other securities regulatory authority, has approved or disapproved of the contents of this news release.
ENDS
SERABI GOLD PLC2nd Floor, 30-32 Ludgate Hill, London EC4M 7DR This document is not intended to and does t +44 (0)20 7246 6830 f +44 (0)20 7246 6831 e contact@serabimining.com www.serabigold.com not amount to an invitation or inducement to Registered Office 66 Lincoln's Inn Fields, London, WC2A 3LH Company Number 5131528 subscribe for shares in Serabi Gold plc
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Placing of 27,300,000 Units to raise £2.73 milllion at a price of 10.0 pence per Unit |