For immediate release 23 June 2014
REABOLD RESOURCES PLC
"Reabold Resources" or the "Company"
New Investments, Placing, Bank Financing Arrangements and TVR
It was announced on 20 December 2013 (when the Company's shares were suspended from trading on AIM under Rule 15) that the Company was in negotiations to make an acquisition which would, if completed, amount to a reverse takeover under the AIM Rules. As set out in the Audited Accounts published on 13 June 2014, this transaction has now been terminated due to the target company pursuing a non-public strategy rather than proceeding with the AIM flotation process.
As a result, the Board has arranged to implement its investing policy through a broader portfolio of investments, in accordance with the Company's investing policy specifically focusing on the natural resource sector which, in the opinion of the Directors, represents a positive cyclical recovery opportunity. Accordingly, subject to the new Ordinary Shares (as referred to below) being admitted to trading on AIM and the suspension of trading on AIM being lifted, the Company has entered in to the following arrangements:
1. Subscriptions totalling £325,000 have been received for 65,000,000 new Ordinary Shares of 0.1p each ("Placing Shares") at a price of 0.5p per share (the "Placing"). The funds will be used to make investments in accordance with the Company's investing policy and for working capital purposes.
Saltwind Enterprises Limited ("Saltwind"), is a company of which Jeremy Edelman, Director; is a director and shareholder and Saltwind has subscribed for 20,000,000 new Ordinary Shares under the Placing and accordingly this is a related party transaction under the AIM Rules. Antony Samaha, the Director independent of the transaction, considers, having consulted with the Company's nominated adviser, that the terms of the transaction are fair and reasonable so far as shareholders are concerned.
The Company has entered into a stock margin service financing facility with Barclays Bank Plc to provide an initial facility of £400,000 to support the Company's listed investment programme. The initial term of the facility is 12 months, with interest payable quarterly at the ToNext rate applicable to low-volatility currency plus 1.35 per cent. The facility may be repaid in whole or part without penalty prior to the expiry of the term.
2. The Company has invested £200,000 in the form of £50,000 in cash and the issue of 5 million new Ordinary Shares issued at a deemed price of 3p per share to purchase 1,480,000 shares in Mogul Ventures Corp. ("Mogul"), representing approximately a 1.3% interest. Mogul is a private company and focuses on exploration, development and production of metals and coal in Mongolia. The main Khar Tolgoi property is a 34,055 ha Mining License located in Dundgovi Province.at Oortsog Ovoo project which has no AIM compliance resources. However historical exploration work at the Oortsog Ovoo deposit is reported to have resulted in the discovery of eight separate tin skarn mineralization zones. Soviet geologists completed detailed exploration at Oortsog Ovoo between 1985 and 1989, culminating in completion of an historic (non AIM compliant) tin mineral resource estimate with respect to the five largest mineralized zones.
The unaudited accounts of Mogul Ventures Corp for the year ended 31 August 2013, show gross assets of C$1,623,463 and net shareholder funds of C$1,087,147 and a net loss and comprehensive loss for the period of C$346,769.
3. The Company has instructed its bankers to purchase from the funds available under 1 above the following listed natural resource shares:
| Amount invested |
Rio Tinto Rio Tinto is a leading global mining and metals group that consists of Rio Tinto plc, registered in England and Wales and Rio Tinto Limited which is registered in Australia. The Group operates under a dual listed company structure with Rio Tinto plc shares primary listing on the Main Market of the London Stock Exchange where it is a component of the FTSE 100 Index and Rio Tinto Limited shares listed on the Australian Securities Exchange. Rio Tinto's diverse portfolio comprises of aluminum, copper, diamonds, thermal and metallurgical coal, uranium, gold, industrial minerals (borax, titanium dioxide and salt) and iron ore. The company's focus is on finding, mining and processing the Earth's mineral resources in order to maximise value for its shareholders. Source: www.riotinto.com For the year ended 31 December 2013, Rio Tinto reported turnover of US$51,171m, profit before taxation of US$3,505m and net assets of US$53,502m | £200,000 |
BP BP is one of the world's leading international oil and gas companies headquartered in London. BP has a primary listing on the Main Market of the London Stock Exchange and is a constituent of the FTSE 100 Index, and has secondary listings on the Frankfurt Stock Exchange and the New York Stock Exchange. BP is vertically integrated and operates in all areas of the oil and gas industry, including exploration and production, refining, distribution and marketing, petrochemicals, power generation and trading. It also has renewable energy activities in biofuels and wind power. Source: www.bp.com For the year ended 31 December 2013, BP reported turnover of US$396,217m, profit before taxation of US$30,221m and net assets of US$130,407m | £200,000 |
BHP Billiton BHP Billiton is a dual-listed global resource group with BHP Billiton Limited primary listing on the Australian Securities Exchange and BHP Billiton Plc premium listing on the London Stock Exchange where it is a component of the FTSE 100 Index, with a secondary listing on the Johannesburg Stock Exchange. In addition BHP Billiton has two American Depositary Receipt listings on the New York Stock Exchange. It is one of the world's largest producers of major commodities including aluminium, coal, copper, iron ore, manganese, nickel, silver and uranium, and with substantial interests in oil and gas. The company's strategy is to own and operate large, long-life, low-cost, expandable, upstream assets diversified by commodity, geography and market. Source: www.bhpbilliton.com For the year ended 31 December 2013, BHP Billiton reported turnover of US$65,968m, profit before taxation of US$17,872m and net assets of US$72,035m | £200,000 |
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As a means of protecting the downside market risk in respect of these investments, the Company has entered into a margin service loan agreement with Barclays Bank PLC. series of "zero collars", established by buying a protective put while writing an out of the money covered call with a strike price at which the premium received is equal to the premium of the protective put purchased. The Company will review these financial instruments on a regular basis and may adjust those to maximise the return from the underlying portfolio.
As a result of the arrangements as set out above, the Company has raised a total of £875,000 in new equity and debt (including the above equity issued for the investment in Mogul) and will have made investments to a total value of £800,000.
Application is being made for the 70,000,000 new Ordinary Shares, which will rank pari passu with all existing ordinary shares, to be admitted to trading on AIM ("Admission"). Admission is expected to take place on or around 24 June 2014, after which trading in the Company's shares will be restored. A further announcement will be made in due course.
On 16 August 2013 following the approval of the Shareholders of a waiver of Rule 9 of the Takeover Code on 13 August 2013, the Company received a conversion notice from Saltwind in respect of the whole principle amount of unsecured Loan Notes details of which are set out in the Circular to Shareholders dated 29 July 2013.
Subsequent to the issue of new ordinary shares issued pursuant to the conversion of Loan Notes, Saltwind was interested in 104,000,000 Ordinary Shares representing 60.85% of the Company's issued share capital and the concert party, being Saltwind and Jeremy Edelman, was interested in 124,000,000 ordinary shares, representing 72.55% of the Company's issued share capital.
Subsequent to the issue of the Placing Shares, together with the issue of the 5,000,000 new Ordinary Shares as described above, Saltwind will be interested in 124,000,000 Ordinary Shares or 51.47% of the Company's issued share capital and Saltwind and Jeremy Edelman, together the Concert Party as set out in the circular to Shareholders dated 29 July 2013, will be interested in 144,000,000 Ordinary Shares or 59.77% of the Company's issued share capital.
Total voting rights
Following the issue of the new Ordinary Shares the Company's share capital will comprise of 240,915,896 Ordinary Shares of 0.1p each, with voting rights, and 6,915,896 "A" deferred shares of 1.65p each. The deferred shares are non-voting, are not admitted to trading on AIM and are not entitled to any participation in the profits or the assets of the Company. Therefore the total number of Ordinary Shares with voting rights is 240,915,896 and 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 to their interest in, the share capital of the Company under the Financial Conduct Authority's Disclosure and Transparency Rules.
For further information please contact:
Reabold Resources plc
Jeremy Edelman +44 (0) 20 7460 2353
Antony Samaha
Beaumont Cornish Limited
Roland Cornish +44 (0) 20 7628 3396
Felicity Geidt
