Ariana Resources plc : £1.25 million subsc...
17 June 2013
AIM: AAU
£1.25 MILLION SUBSCRIPTION AND EQUITY SWAP
TOTAL VOTING RIGHTS
Ariana Resources plc ("Ariana" or "the Company") is pleased to announce that it has conditionally raised £1.25 million (before expenses) by way of a subscription by Lanstead Capital L.P. ("Lanstead") for a total of 125,000,000 ordinary shares of 1p each (the "Subscription").
Dr. Kerim Sener, Managing Director, commented:
"We are pleased to welcome Lanstead Capital as shareholders in the Company and look forward to advancing the development of the Kiziltepe Sector of the Red Rabbit Project through environmental certification and on to construction. The investment from Lanstead Capital comes at an important time in the development of the Company and provides us with sufficient capital to proceed to the construction phase of the Kiziltepe mine as the Company progresses its near term intention to become a producer."
Use of Proceeds
The funds will be used by the Company to help develop the Company's Red Rabbit Project in western Turkey, to continue exploration in the wider Red Rabbit Project Area and for general working capital. The Company is expecting to finalise environmental and various construction permitting matters during Q3-Q4 2013 in order to enter the construction phase by year-end, once mine finance is secured at the Joint Venture company level.
The Subscription
Lanstead, an institutional investor, has subscribed for 125,000,000 new ordinary shares of 1p each (the "Lanstead Subscription Shares") at 1p per share for an aggregate consideration of £1,250,000. In addition, the Company has entered into an Equity Swap Agreement with Lanstead, which allows the Company to retain much of the economic interest in the Lanstead Subscription Shares. The Equity Swap Agreement will allow the Company to secure much of the potential upside arising from near term news flow.
The Equity Swap Agreement provides that the Company's economic interest will be determined and payable in 24 monthly settlement tranches as measured against a Benchmark Price of 1.33 pence per share. If the measured share price exceeds the Benchmark Price, for that month, the Company will receive more than 100 per cent of the monthly settlement due. There is no upper limit placed on the additional proceeds receivable by the Company as part of the monthly settlements. Should the share price be below the Benchmark Price, the Company will receive less than 100 per cent of the expected monthly settlement on a pro rata basis. Of the subscription proceeds of £1,250,000 the Company will use £250,000 for working capital and £1,000,000 for investment in the Equity Swap under the Agreement as described above. In no case would a decline in the Company's share price result in any increase in the number of ordinary shares received by Lanstead or any other advantage accruing to Lanstead.
The Company will also issue 12,500,000 new ordinary shares to Lanstead in consideration for the Equity Swap Agreement. The mid-market price of an ordinary share at the close of business on 14 June 2013 (being the latest practicable day prior to the publication of this announcement) was 1.125p. Application has been made for the 137,500,000 new ordinary shares of 1p each, which when issued will rank pari passu with the existing shares in issue, to be admitted to trading on AIM and such admission is expected to become effective on 19 June 2013.
The structure of this placing is designed to provide the Company with flexibility in continuing to advance the Red Rabbit Project while realising results as well as maintaining a constant source of funds covering a substantial part of the Company's longer term cash flow requirements.
Following the issue of the new ordinary shares, the Company's issued share capital will consist of 554,949,474 Ordinary Shares with a nominal value of 1p each, with voting rights ("Ordinary Shares"). The Company does not hold any Ordinary Shares in Treasury. Therefore the total number of Ordinary Shares in the Company with voting rights is 554,949,474.
Contacts:
| Ariana Resources plc | Tel: +44 (0) 20 7407 3616 |
| Michael Spriggs, Chairman | |
| Kerim Sener, Managing Director | |
| Beaumont Cornish Limited | Tel: +44 (0) 20 7628 3396 |
| Roland Cornish / Felicity Geidt | |
| Beaufort Securities Limited | Tel: +44 (0) 20 7382 8387 |
| Chris Rourke / Guy Wheatley | |
| Loeb Aron & Company Ltd. | Tel: +44 (0) 20 7628 1128 |
| John Beresford-Peirse / Dr. Frank Lucas | |
| St Brides Media & Finance Ltd | Tel: +44 (0) 20 7236 1177 |
| Susie Geliher / Lottie Brocklehurst | |
Editors' note:
About Ariana Resources:
Ariana is an exploration and development company focused on epithermal gold-silver and porphyry copper-gold deposits in Turkey. The Company is developing a portfolio of prospective licences selected on the basis of its in-house geological and remote-sensing database, on its own in western Turkey and in Joint Venture with Eldorado Gold Corporation in north-eastern Turkey. Eldorado owns 51% of this joint venture and are fully funding all exploration work on the JV properties, while Ariana owns 49%. The total resource inventory within this JV is 1.09 million ounces of gold.
The Company's flagship assets are its Kiziltepe and Tavsan gold projects which form the Red Rabbit Gold Project. Both contain a series of prospects, within two prolific mineralised districts in the Western Anatolian Volcanic and Extensional (WAVE) Province in western Turkey. This Province hosts the largest operating gold mines in Turkey and remains highly prospective for new porphyry and epithermal deposits. These core projects, which are separated by a distance of 75km, are presently being assessed as to their economic merits and now form part of a Joint Venture with Proccea Construction Co. The total resource inventory at the Red Rabbit Project stands at 448,000 ounces of gold equivalent.
Ariana also has a strategic investment in Tigris Resources Limited (www.tigrisresources.com), a private Jersey-based exploration company, which is focused on the exploration of copper and gold deposits in southeastern Turkey. Ariana retains 11.5% of Tigris Resources Limited.
Beaufort Securities Limited and Loeb Aron & Company Ltd. are joint brokers to the Company and Beaumont Cornish Limited is the Company's Nominated Adviser.
For further information on Ariana you are invited to visit the Company's website at www.arianaresources.com.
About Lanstead:
Lanstead is an institutional equity investor active globally in a number of sectors including natural resources. Lanstead has been investing in listed companies since 2008.
Ends
The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and other applicable laws; and
(ii) they are solely responsible for the content, accuracy and originality of the
information contained therein.
Source: Ariana Resources plc via Thomson Reuters ONE
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