27 January 2016
Bezant Resources Plc
("Bezant" or the "Company")
Exercise of Option to Acquire Leeward Islands Exploration LLC
Highlights:
Acquisition
· The Company has now acquired 100 per cent. of the share capital of Leeward Islands Exploration LLC ("Leeward")
· Leeward holds options (the "Project Options") over, in aggregate, 2,750ha of near-surface, alluvial, platinum and gold mining and exploration licences located in the Choco Department of Colombia (the "Project Licences")
· The area in which the Project Licences are located has been historically mined with near surface dredges
· Consideration comprises US$1,000,000 cash and 37,306,137 new ordinary shares in Bezant
Future strategy
· Bezant's Board has a track record of successfully developing platinum group metal (PGM) mining operations outside of the standard reef model
· Bezant will undertake a series of work streams to assess the geology, mineralisation, metallurgy and mining profile of the Project Licences
· Progress the assessment of the viability of the assets with a view to excercising the Project Options and ultimately commencing near-term, surface mining operations
· Potential low cost, recoverable platinum recovery located outside of South Africa
· Positions Bezant to take advantage of depleting PGM stock piles and the increasingly costly existing global deep vein platinum mines
Bezant (AIM: BZT), the AIM quoted mineral exploration and development company, today announces that, further to its announcements of 16 November 2015, 22 December 2015 and 21 January 2016, the Company has now completed its due diligence exercise on Leeward and its interests over the Project Licences and, on 26 January 2016, it exercised its option to acquire 100 per cent. of Leeward (the "Acquisition"). Leeward holds options to potentially acquire a 100 per cent. interest in licences covering 2,659ha and a 70 per cent. interest in a licence covering 91ha. All the licences have prospectivity for near-surface, alluvial, platinum and gold and are located in the Choco Department of Colombia, in an area historically mined using dredges. As part of its recently completed due diligence exercise, Bezant has obtained a Colombian legal opinion regarding the validity of the Project Licences and the Project Options and the good standing of the local Colombian companies to which they have been granted.
Bezant's Board has a track record of successfully developing PGM projects outside of standard reef models, with the Company's Non-Executive Chairman, Edward Nealon, having been involved in the early stage of founding Aquarius Platinum plc and Sylvania Resources Limited.
Following today's Acquisition, Bezant will move forward with a series of work streams to assess the geology, mineralisation, metallurgy and mining profile of the Project Licences, with a view to exercising one or more of the Leeward group's exisiting options and, ultimately, creatinge a low cost platinum and gold production operation outside of South Africa. Prior to commencing exploration activities in relation to the Project Licences, in compliance with Colombian Law, Bezant will be required to carry out certain consultation processes with local communities in the Project Licence areas, and obtain the relevant environmental and related permits and approvals.
Whilst PGM prices are currently depressed, Bezant's Board believes that significant pressure on major platinum sources and depleting stock-piles should enable Bezant to realise potentially significant margins from the successful future development of the Project Licence areas, should the Company elect to exercise the options held by Leeward.
Consideration for Leeward and further details of the Acquisition
As announced on 16 November 2015, pursuant to the terms of the option agreement, Bezant has paid US$1,000,000 cash consideration to the shareholders of Leeward (the "Vendors") from its existing cash resources.
In addition, Bezant has issued 37,306,137 new ordinary shares (the "Consideration Shares") of £0.002 each in the capital of Bezant ("Ordinary Shares") to the Vendors, in settlement of the US$1,000,000 share element of the consideration, at the volume weighted average share price of the Ordinary Shares for the 20 business days up to and including 25 January 2016, being 1.88 pence (approximately 2.68 cents). The Consideration Shares represent approximately 27.26 per cent. of the Company's enlarged share capital and they will rank pari passu in all respects with the existing Ordinary Shares of the Company. The Consideration Shares have been issued pursuant to the share capital authorities approved by shareholders at the Company's Annual General Meeting held on 11 December 2015.
Bezant and the Vendors have entered into a share purchase agreement with respect to the Acquisition, pursuant to which the Vendors have provided certain customary warranties to the Company in respect of Leeward. Such warranties are subject to certain financial caps and other limitations.
Relationship Agreement
On completion of the Acquisition, Tomori Enterprises Limited, the largest of the Vendors, willhold approximately 24.95 per cent. of the Company's enlarged issued share capital. Due to the size of the Vendors shareholding, Bezant and the Vendors have entered into a relationship deed (the "Relationship Agreement"), which sets out the terms by which the Vendors will conduct business with the Company.
The Relationship Agreement seeks to regulate the relationship between the Vendors and the Company in such a manner as to enable the Company to carry on its business independently of the Vendors and provides that all transactions and relationships between the Company and the Vendors shall be at arm's length and on normal commercial terms. The Relationship Agreement contains undertakings by the Vendors relating to the exercise of their rights in the Company, including the exercising of their voting rights. The provisions of the Relationship Agreement shall terminate in the event that the Vendors and their associates hold less than 20 per cent. of the Company's issued share capital.
Application to trading on AIM
Application has been made to the London Stock Exchange plc for the abovementioned Consideration Shares to be admitted to trading on AIM ("Admission"). It is expected that Admission will become effective and that dealings in the Consideration Shares will commence on AIM at 8.00 a.m. on 2 February 2016.
Following the issue of the Consideration Shares, the Company's issued share capital will consist of 136,833,162 Ordinary Shares with voting rights. The Company does not hold any Ordinary Shares in treasury and accordingly there are no voting rights in respect of any treasury shares. The Consideration Shares will be fully paid and will rank pari passu in all respects with the Company's existing Ordinary Shares.
The above figure of 136,833,162 Ordinary Shares 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, Bezant under the Financial Conduct Authority's Disclosure and Transparency Rules.
Ed Nealon, Non-Executive Chairman, commented:
"Bezant management team has a track record of identifying and developing assets into successful production. Our time working at companies such as Acquarius Platinum, Sylvania Platinum and Tanzanite One involved us identifying assets or processes that had been overlooked by most other companies as 'not the way things are done' and building valuable mining operations.
"What I really like about the Project Licences is the identifiable high concentrations of platinum, set against an established regional history of successful near surface dredge mining. Our objective is to determine whether enhanced dredge techniques and processes can be quickly and cost effectively implemented, first of all to underpin the Company with respect to the future cashflow, then to be ready to take advantage of potential supply issues within the major global production regions.
"I have been closely watching the PGM space for the last five years and I, and the board, are very much of the opinion that the creation of a new platinum production portfolio, outside of South Africa and not deep underground, at this opportune time could yield significant results."
For further information, please contact:
Bezant Resources Plc Bernard Olivier Chief Executive Officer Laurence Read Non-Executive Director |
Tel: +61 40 894 8182 Tel: +44 (0)20 3289 9923 |
Strand Hanson Limited (Nomad and Broker) James Harris / Matthew Chandler / James Dance |
Tel: +44 (0)20 7409 3494 |
or visit http://www.bezantresources.com
