Ironveld Plc

("Ironveld" or the "Company")

Fundraising at a premium and Board change

Ironveld plc ("Ironveld" or the "Company"), the AIM quoted mining development company, is pleased to confirm that its largest shareholder, Tracarta Limited ("Tracarta") (in which current Non-Executive Director Dr John Wardle has a beneficial interest), has agreed to cornerstone a fundraising at a premium to the current share price (the "Subscription" or "Fundraising"), to assist with the ongoing working capital requirements of the business.   

Highlights

·  Cash subscription by Tracarta of £450,000 for 162,000,000 new Ordinary Shares in the Company ("Tracarta's Subscription") at a price per share of 0.278p  (the "Subscription Price"), representing a premium of 23.5 per cent. to the closing mid-price of 0.225p on 25 October 2023;

·    In addition, Turner Pope, acting as the Company's Broker, has procured orders for a further £550,000 from existing shareholders on the same terms;

·   Conditional upon shareholder approval, all subscribers will also be issued with warrants to subscribe for new Ordinary Shares at a price of 0.29p; and

·    Following Tracarta's Subscription , Dr John Wardle will assume the role of Executive Chairman of the Company, with Giles Clarke remaining as a Non-Executive Director.

Outgoing Chairman, Giles Clarke, commented: "I have worked with John Wardle over many years and know him to be a man with a successful track record in the natural resources space. His executive experience from senior positions at the likes of Amerisur Resources and Emerald Energy hold him in good stead and I am delighted that he has agreed to become Executive Chairman of the Company, which is consistent with Tracarta's position as the Company's largest investor. I will continue to provide the Company with my ongoing support as a Non-Executive Director as the Company continues in its transformational phase of development."

Incoming Chairman, John Wardle commented: "I thank Giles for his contribution in advancing the Company to its current stage of development and I look forward to working more directly with the Ironveld team. Our objective is to drive the further development of the Company in the short term and demonstrate the inherent value of our assets."

Details of the Fundraising use of proceeds

Since the Company's Operations Update on 18 September 2023, the operations at the Rustenburg smelter have consumed a greater amount of cash resources than originally planned, in particular the impact of critical repairs and optimisation costing approximately £250,000 to rectify which, combined with a material interruption to planned production during October, has created a requirement for additional working capital.

Whilst the Directors' loan facilities announced in September still have undrawn headroom, the Board considers that it is prudent to maintain a larger working capital buffer in order to provide maximum flexibility in maintaining operations and believes that the Fundraising at a substantial premium to the existing market price of the shares represents an attractive option.

The Ipace DMS Magnetite joint venture is progressing as planned and first product will be shipped and sold in November 2023.

Tracarta's investment is based on the available authorised headroom available to the Company, being approximately 162,000,000 new Ordinary Shares. Given this strong demonstration of support by the Company's largest investor, Turner Pope has been able to procure subscribers for a further £550,000 for a further 198,000,000 new Ordinary Shares (together with Tracarta's Subscription, the "Subscription Shares").

The Subscription Price per share is 0.278p, representing a premium of 23.5 per cent. To the closing mid-market price of 0.225p on 25 October 2023.

Board Change

The Board has agreed that, following Tracarta's Subscription, Dr John Wardle will assume the role of Executive Chairman of the Company, whilst Giles Clarke will remain as a Non-Executive Director.

Related Party Opinion

Tracarta has agreed to subscribe for 162,000,000 Shares for a total of £450,000 in cash.

The resultant holding of the relevant Director is included in the table below:

* J Wardle's interest in all Ordinary Shares above is through his beneficial interest in Tracarta.

** Assuming the issue of all new Ordinary Shares pursuant to the Fundraising

John Wardle has a beneficial interest in Tracarta and, as such, the Subscription constitutes a related party transaction pursuant to Rule 13 of the AIM Rules for Companies. The Company's independent Directors (being Giles Clarke, Nick Harrison, Peter Cox, Martin Eales and Malebo Ratlhagane) consider, having consulted with the Company's nominated adviser, Cavendish, that the terms of Tracarta's Subscription are fair and reasonable insofar as the Company's shareholders are concerned.

Details of the Fundraising

In total, 360,000,000 new Ordinary Shares are proposed to be allotted and issued pursuant to the Fundraising, at a Subscription Price of 0.278 pence per new Ordinary Share to raise gross proceeds of £1,000,000. The Tranche 2 Subscription Shares (as detailed below), have been conditionally placed by Turner Pope, acting as agent and broker of the Company.

The Company currently has limited shareholder authority to issue new Ordinary Shares for cash on a non-pre-emptive basis. Accordingly, the Fundraising is being conducted in two tranches as set out below: 

1.    Tranche 1 Subscription

A total of £450,000, representing the issue and allotment of 162,000,000 new Ordinary Shares (the "Tranche 1 Subscription Shares") at the Subscription Price (the "Tranche 1 Subscription"), has been raised using the Company's existing share allotment authorities which were granted at the Company's general meeting held on 13 March 2023. Application has been made for the Tranche 1 Subscription Shares to be admitted to trading on AIM and it is expected that their admission to AIM will take place on or around 31 October 2023 ("First Admission"). The issue of the Tranche 1 Subscription Shares is conditional, inter alia, on First Admission. The issue of the Tranche 1 Subscription Shares is not conditional on the Tranche 2 Subscription completing.

2.    Tranche 2 Subscription

The balance of the Fundraising, being approximately £550,000 and representing the issue and allotment of 198,000,000 new Ordinary Shares (the "Tranche 2 Subscription Shares") at the Subscription Price (the "Tranche 2 Subscription")  is conditional upon, inter alia, the passing of resolutions to be put to shareholders of the Company at a general meeting of the Company to be held on 13 November 2023 (the "Resolutions") to provide the relevant authorities to the Directors to issue and allot further new Ordinary Shares on a non-pre-emptive basis, whereby such authorities will be utilised by the Directors to enable completion of the Tranche 2 Subscription (amongst other things, as detailed below). 

Conditional on the passing of the Resolutions, application will be made for the Tranche 2 Subscription Shares to be admitted to trading on AIM and it is expected that their admission to AIM will take place on or around 14 November 2023 ("Second Admission").

In addition to the passing of the Resolutions, the Tranche 2 Subscription is conditional, inter alia, on Second Admission.

The Tranche 1 Subscription Shares and Tranche 2 Subscription Shares will, when issued, be credited as fully paid and will rank pari passu in all respects with the existing Ordinary Shares of the Company, including the right to receive all dividends or other distributions made, paid, or declared in respect of such shares after the date of issue of the relevant Subscription Shares.

Warrants

The Company is proposing to issue subscribers to the Fundraising with warrants to subscribe for new Ordinary Shares on the basis of one (1) warrant for every one (1) Subscription Share (the "Investor Warrants"). The Investor Warrants are exercisable at 0.29 pence for a period of three years from the date of their grant, on Second Admission. 

The grant of the Investor Warrants is conditional on the passing of the Resolutions to be put to shareholders of the Company at the General Meeting to provide the relevant authorities to the Directors to issue and allot further new Ordinary Shares on a non-pre-emptive basis. None of the Investor Warrants will be admitted to trading on AIM or any other stock exchange.

Direct Funding Discussions

The Company confirms that the direct funding discussions as detailed in the announcement dated 18 September 2023 are still ongoing. The Company will provide a further update when appropriate.

Total voting rights

Following First Admission, the Company's total issued share capital will consist of 3,736,996,887 Ordinary Shares, with one voting right per share. The Company does not hold any shares in treasury. Therefore, the total number of Ordinary Shares and voting rights in the Company will be 3,736,996,887 from First Admission. This figure 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 pursuant to the FCA's Disclosure Guidance and Transparency Rules.

Notice of General Meeting

The Company will publish a Circular to convene the General Meeting to propose the Resolutions to enable completion of the Fundraising, and the grant of the Investor Warrants.

The General Meeting will be held at 10.00 a.m. on 13 November 2023. The circular containing the notice of general meeting will be published and sent to shareholders in the coming days and will be available on the Company's website, www.ironveld.com. Shareholders are strongly urged to vote by proxy in accordance with the instructions that will be set out in the notice of general meeting.

For further information, please contact:

NOTES TO EDITORS

Ironveld (IRON.LN) is the owner of Mining Rights over approximately 28 kilometres of outcropping Bushveld magnetite with a SAMREC compliant ore resource of some 56 million tons of ore grading 1.12% V2O5, 68.6% Fe2O3 and 14.7% TiO2.

In 2022 Ironveld agreed to acquire and refurbish a smelter facility in Rustenburg, South Africa, in which it can process its magnetite ore into the marketable products of high purity iron, titanium slag and vanadium slag. This transaction became unconditional in March 2023.

Ironveld is an AIM traded company. For further information on Ironveld please refer to www.ironveld.com.