TIDMIRON
RNS Number : 8682Q
Ironveld PLC
23 February 2023
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THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES
OF ARTICLE 7 OF REGULATION 2014/596/EU. IN ADDITION, MARKET
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OF INSIDE INFORMATION.
Ironveld plc
Placing to raise GBP2.0 million
Notice of General Meeting
Ironveld plc ("Ironveld" or the "Company"), the AIM quoted
mining development company, is pleased to announce a proposed
fundraising of GBP2.0 million (the "Fundraising").
The Fundraising will comprise a placing of, in aggregate,
666,666,666 new ordinary shares of 0.1 pence each in the Company
("Ordinary Shares" and such 666,666,666 new Ordinary Shares being
the "Placing Shares"), at a price of 0.30p per Placing Share
("Placing Price"), to raise GBP2.0 million before expenses
(together, the "Placing").
280,000,000 of the Placing Shares (the "First Placing Shares")
will be issued out of authorities granted to the Directors at the
Company's last annual general meeting (the "Firm Placing") and the
remaining 386,666,666 Placing Shares (the "Second Placing Shares")
will be issued subject to the requisite authorities being granted
to the Directors at a General Meeting of the Company's shareholders
to be convened in due course (the "Conditional Placing").
Highlights
-- The Company is undertaking an equity fundraising for total
gross proceeds of GBP2.0 million comprised of a firm Placing for
GBP840,000 and a conditional Placing for GBP1.16 million;
-- Every two (2) Placing Shares will have one (1) warrant
attached, exercisable at 0.50 pence per warrant for a period of two
years from the date of their grant, on Second Admission ("Investor
Warrants"). All Investor Warrants are to be issued once the
relevant resolutions have been passed at the General Meeting.
-- The Placing Price represents a 5.26 per cent. premium to the
prevailing price per Ordinary Shares on 22 February 2023 following
strong support from existing shareholders;
-- The net proceeds of the Fundraising, will be applied to fund
general working capital and acceleration of final works necessary
to reach full production capacity at the Rustenburg smelter complex
in the coming months.
Background to the Fundraising
Ironveld's management has been very pleased with the progress
made since August 2022, when Ironveld's team first gained working
access to the Rustenburg smelter complex. Following extensive
refurbishment, the mothballed plant achieved first production in
early January 2023 which was comfortably in line with the Company's
initial target of Q1 2023, and since then all parts of the entire
production process have been tested and modified to ensure that the
first furnace approaches targeted daily production levels. The
second and third furnaces are on track to be in production, as
planned, by April 2023.
Stockpiling of finished high purity iron ("HPI") and titanium
slag is already underway and first sales to customers are in line
to be concluded as planned in Q2 2023, once batch sizes have
reached optimum levels. Following acceleration of planned works to
the process equipment, in particular the convertor required to
separate vanadium slag, this third product and revenue stream will
also be available within the coming weeks. Full production capacity
at the smelter is expected to be reached by the middle of 2023.
In the coming months, as production increases to planned levels,
the Company's finances will be tied up in working capital for the
operation of the plant. In particular, the Company's diesel costs
consumed by the existing generators have risen since the date of
the Company's previous fundraising in July 2022. While the Company
awaits commissioning of its independent solar hybrid power plant
anticipated in Q3 2023, the Board considers it prudent to guard
against further inflationary pressures by conducting the
Fundraising. Accordingly, the Directors believe that the proceeds
of the Fundraising will enable the Company to trade through to
monthly cash flow positivity on a more efficient and secure
basis.
Ironveld has recently received a number of proposals for short
term working capital financing but, following discussions with key
shareholders, it was felt that a Placing at a small premium to the
underlying market price was the most attractive option. The Placing
Price represents a premium of 5.26 per cent. to the 5 day VWAP per
Ordinary Share on 22 February 2023.
The legal process related to closing of the smelter acquisition
from Business Rescue has been complex and time consuming. As
previously announced, all major underlying agreements for the
transaction have been signed and only minor administrative items
remain to be completed. As such, the Company and the sole creditor
are very confident that the successful conclusion of the
transaction will be achieved shortly. In the meantime, the Company
continues to operate the smelter without interruption and legally
benefits from the proceeds of all product sales.
Related Party Opinion
Giles Clarke and Tracarta Limited (in which John Wardle has a
beneficial interest) have agreed to subscribe for an aggregate of
126,666,666 Placing Shares at the Placing Price for a total of
GBP380,000 cash under the terms of the Conditional Placing.
The resultant holdings of the relevant Directors are included in
the table below:
Director Existing Per cent. Placing Shares Revised Percentage
Holding Holding of Enlarged
Issued Share
Capital
G Clarke* 57,221,168 1.98 10,000,000 67,221,168 1.91
J Wardle** 237,046,901 8.19 116,666,666 353,713,567 10.03
* G Clarke's interests in 10,062,470 Ordinary Shares above are
through his shareholding in Westleigh Investments Holdings
Limited.
** J Wardle's interest in all Ordinary Shares above are through
his beneficial interest in Tracarta Limited.
Each of Giles Clarke and John Wardle is a related party of the
Company for the purposes of the AIM Rules by virtue of their status
as Directors of the Company. The independent Directors for this
purpose, being each of Martin Eales, Peter Cox and Nick Harrison,
consider, having consulted with the Company's nominated adviser,
finnCap, that the terms of Giles Clarke and John Wardle's
participation in the Placing are fair and reasonable insofar as the
Company's shareholders are concerned.
Details of the Placing
The Placing has been wholly supported by existing institutional
and other investors, and was conducted by TPI acting as sole broker
for the Company.
In total, 666,666,666 Placing Shares are proposed to be allotted
and issued pursuant to the Placing, at a Placing Price of 0.30
pence per Placing Share to raise gross proceeds of GBP 2.0 million.
The Placing Shares, excluding the First Placing Shares (as detailed
below), have been conditionally placed by TPI acting as agent and
broker of the Company, pursuant to a Placing Agreement, as detailed
below.
The Company currently has limited shareholder authority to issue
new Ordinary Shares for cash on a non-pre-emptive basis.
Accordingly, the Placing is being conducted in two tranches as set
out below:
1. Firm Placing
A total of GBP840,000, representing the issue and allotment of
280,000,000 Placing Shares at the Placing Price, has been raised
using the Company's existing share allotment authorities which were
granted at the Company's annual general meeting held on 17 January
2023 . Application has been made for the First Placing Shares to be
admitted to trading on AIM and it is expected that their admission
to AIM will take place on or around 1 March 2023 ("First
Admission"). The issue of the First Placing Shares is conditional,
inter alia, on First Admission and the Placing Agreement becoming
unconditional in respect of the First Placing Shares and not being
terminated in accordance with its terms prior to First Admission.
The issue of the First Placing Shares is not conditional on the
Conditional Placing completing.
2. Conditional Placing
The balance of the Placing, being approximately GBP1.16 million
and representing the issue and allotment of 386,666,666 Placing
Shares at the Placing Price 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 March 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 Conditional Placing (amongst other
things, as detailed below).
Conditional on the passing of the Resolutions, application will
be made for the Second Placing Shares to be admitted to trading on
AIM and it is expected that their admission to AIM will take place
on or around 15 March 2023 ("Second Admission").
In addition to the passing of the Resolutions, the Conditional
Placing is conditional, inter alia, on Second Admission and the
Placing Agreement becoming unconditional in respect of the Second
Placing Shares and not being terminated in accordance with its
terms prior to Second Admission. The Firm Placing is not
conditional on the Conditional Placing completing.
The Placing 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 Placing Shares.
Warrants
The Company is proposing to issue subscribers to the Placing
with warrants to subscribe for new Ordinary Shares on the basis of
one (1) warrant for every two (2) Placing Shares. The Investor
Warrants are exercisable at 0.50 pence for a period of two years
from the date of their grant, on Second Admission.
In addition, the Company is proposing to issue TPI with up to
135,000,000 warrants to subscribe for 135,000,000 new Ordinary
Shares ("Broker Warrants"). The Broker Warrants are exercisable at
the Placing Price for a period of three years from the date of
their grant, on Second Admission.
The grant of the Investor Warrants and the Broker 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
warrants will be admitted to trading on AIM or any other stock
exchange.
Placing Agreement
Under the terms of a Placing Agreement between the Company and
TPI, TPI will receive a corporate finance fee from the Company and
commission relating to the Placing Shares conditional on First
Admission and Second Admission. The Company will give customary
warranties and undertakings to TPI in relation, inter alia, to its
business and the performance of its duties. In addition, the
Company has agreed to indemnify TPI in relation to certain
liabilities that it may incur in undertaking the Placing.
TPI also has the right to terminate the Placing Agreement in
certain circumstances prior to First Admission and Second
Admission, in particular, in the event that there has been, inter
alia, a material breach of any of the warranties. No part of the
Placing is being underwritten.
Total voting rights
Following First Admission, the Company's total issued share
capital will consist of 3,173,128,854 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 3,173,128,854 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
Placing, and the grant of the Investor Warrants and the Broker
Warrants.
The General Meeting will be held at 10.00 a.m. on 13 March 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 to be set out in the notice of general meeting.
The maximum aggregate number of new Ordinary Shares that may be
issued pursuant to the Placing, is 666,666,666.
**ENDS**
For further information, please contact:
Ironveld plc c/o BlytheRay
Giles Clarke, Chairman +44 20 7138 3204
Martin Eales, Chief Executive Officer
finnCap (Nomad and Joint Broker)
Christopher Raggett / Charlie Beeson +44 20 7220 0500
Turner Pope (Joint Broker)
Andrew Thacker/James Pope +44 20 3657 0050
BlytheRay
Tim Blythe / Megan Ray +44 20 7138 3204
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.
Ironveld is an AIM traded company. For further information on
Ironveld please refer to www.ironveld.com .
This announcement contains inside information for the purposes
of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it
forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with
the company's obligations under Article 17 of MAR.
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