TIDMPFP
RNS Number : 8108V
Pathfinder Minerals Plc
10 April 2019
10 April 2019
Pathfinder Minerals Plc
("Pathfinder" or the "Company")
Corporate Update, Scoping Study
&
Subscription & Further Issue of Equity
Pathfinder provides an update on progress towards restoring an
interest in Mining Concession 4623C (the "Licence") in Mozambique
and settling all current and pending legal disputes associated
directly and indirectly with the Licence (the "Proposed
Transaction").
The Board is evaluating multiple transaction structures, taking
into account commercial and regulatory factors, through which the
Company could hold its interest in the Licence and deliver value
for shareholders. While the optimal structure of the Proposed
Transaction remains under evaluation, the Board is pleased to relay
that the principle of a Proposed Transaction has been agreed
between Pathfinder and General Jacinto Veloso who, with his family
interests, is a 50 per cent shareholder in the entity to which the
Licence is currently registered. In parallel, the Board is
evaluating, and is in active discussions with regards to, potential
funding strategies (including both partnerships and debt provision)
to facilitate the Proposed Transaction and finance subsequent
development of the Licence. The Board's objective is to deliver
meaningful value to current shareholders and minimise future
dilution. Further updates will be provided as and when
appropriate.
The Licence contains the Moebase and Naburi heavy mineral sands
deposits previously licensed to the Company under Mining
Concessions 760C and 4623C. The amalgamated Licence covers
approximately 32000 hectares of land on the Indian Ocean coast of
the Zambezia province of Mozambique, containing ilmenite, rutile
and zircon.
Updated Scoping Study
The Board commissioned an independent technical consultant, 2M
Mineral Services Limited, to prepare a revised Scoping Study on the
Licence (the "2019 Report"), which includes a revision of the
capital and operating costs and pricing assumptions that were
presented in the URS/Scott Wilson 2011 scoping study report (the
"2011 Report"). This revision has resulted in an estimated pre-tax
net present value ("NPV") at a 10 per cent discount rate of US$1.05
billion; with projected annual revenues of US$323 million over a
mine life of 30 years. The project internal rate of return ("IRR")
is expected to be approximately 25 per cent. The revised findings
represent a near doubling of the previously reported equivalent NPV
and an increase of 6.1 per cent in the project IRR. A summary of
the key differences in scoping study outcomes between the 2011
Report and the 2019 Report is set out below.
Key Differences in Scoping Study Outcomes between 2011 and 2019 Scoping
Study Reports:
2011 2019 Change
%
------------ ------------- ------------ --------
Estimated Run of Mine production Mtpa 47.7 47.7 0%
------------ ------------- ------------ --------
Estimated Life of Mine Years 30 30 0%
------------ ------------- ------------ --------
Estimated Mineral Content Split
of Final Product Ilmenite 93.4% 93.4% 0%
------------ ------------- ------------ --------
Rutile 1.8% 1.8% 0%
-------------------------------------------------- ------------- ------------ --------
Zircon 4.8% 4.8% 0%
-------------------------------------------------- ------------- ------------ --------
Estimated Annual Production ('000
tonnes) Ilmenite 1,245 1,245 0%
------------ ------------- ------------ --------
Rutile 24 24 0%
-------------------------------------------------- ------------- ------------ --------
Zircon 65 65 0%
-------------------------------------------------- ------------- ------------ --------
Projected Annual Revenues US$ m 247 323 +19.4%
------------ ------------- ------------ --------
Initial Capital Cost US$ m 686 742 +7.5%
------------ ------------- ------------ --------
Estimated Pre-tax IRR % 18.8% 24.9% +6.1%*
------------ ------------- ------------ --------
Estimated Pre-tax NPV @ 10% discount
rate US$ m 529 1,046 +97.7%
------------ ------------- ------------ --------
Pricing Assumptions (USD/tonne) Ilmenite 125 173 +38.4%
------------ ------------- ------------ --------
Rutile 677 908 +34.1%
-------------------------------------------------- ------------- ------------ --------
Zircon 1,148 1,320 +15.0%
-------------------------------------------------- ------------- ------------ --------
* On an absolute basis
The 2019 Report is based on the previously estimated historical
mineral resource of the Licence of 2.02 billion tonnes, with a
total heavy mineral content of approximately 3.55 per cent -
equivalent to approximately 71.7 million tonnes of contained heavy
minerals - which will be the subject of confirmation drilling and
re-estimation in the next stage of study.
Issue of Equity
Cash Subscription
The Company has conditionally raised GBP200,000 via a
subscription for 10,000,000 new ordinary shares of 0.1p each in the
capital of Company ("Ordinary Shares") (the "Subscription Shares")
at a price of 2.0p per share (the "Subscription Price") with new
and existing investors, including a director of the Company (the
"Subscription"). The Subscription is conditional only on admission
of the Subscription Shares to trading on AIM.
The Subscription Price represents a premium of approximately 48
per cent over the middle market closing price of the Company's
Ordinary Shares on 9 April 2019 (the latest practicable date prior
to the publication of this announcement), which was 1.35p.
The proceeds from the Subscription are to be utilised for
general working capital purposes.
Settlement Share Issue
In addition, the Company has agreed to issue, in aggregate,
7,500,000 new Ordinary Shares at 2.0p per share to a current
director and certain former directors (the "Participating
Directors") in satisfaction of deferred salary that has been
accrued (the "Settlement Shares"). The Settlement Share issue has
the positive effect of reducing the Company's accrued cash
liabilities by an aggregate GBP150,000.
Details of the Subscription Shares and Settlement Shares to be
issued to the Participating Directors are set out below:
Director/Former Number of Number of Total Ordinary Ordinary
Director Ordinary Ordinary Shares Shares held Share holding
Shares subscribed issued in immediately as a percentage
for pursuant settlement following of enlarged
to the Subscription of accrued admission share capital
directors' of the Subscription immediately
fees pursuant Shares and following
to the Settlement the Settlement admission
Share issue Shares of the Subscription
Shares and
the Settlement
Shares
Scott Richardson
Brown 1,250,000 - 3,101,851 1.07%
--------------------- ------------------ --------------------- ---------------------
Sir Henry Bellingham - 1,250,000 1,250,000 0.43%
--------------------- ------------------ --------------------- ---------------------
Nicholas Trew* - 3,608,350 n/a n/a
--------------------- ------------------ --------------------- ---------------------
Robert Easby* - 2,641,650 n/a n/a
--------------------- ------------------ --------------------- ---------------------
* directors within the past 12 months
Participating Director (as defined above)
Related Party Transactions
As a director of the Company, the participation in the
Subscription by Scott Richardson Brown is treated as a related
party transaction.
As a director and former directors of the Company within the
past 12 months, the participation of the Participating Directors in
the Settlement Share issue is treated as a related party
transaction.
Accordingly, Simon Farrell, being the only independent director
in relation to Scott Richardson Brown's participation in the
Subscription and the Participating Directors' participation in the
Settlement Share issue, considers, having consulted with the
Company's Nominated Adviser, Strand Hanson Limited, that the terms
of the respective participations are fair and reasonable insofar as
the Company's shareholders are concerned.
Issue of Share Options
The Company has today also granted a total of 7,500,000 share
options over 7,500,000 Ordinary Shares to Scott Richardson Brown.
Further details of the share option grant are set out below:
Director No. of share Exercise Expiry date Total no. of
options granted Price share options
held
================== ================= ========= ============ ==============
Scott Richardson
Brown 7,500,000 2.50p 10/04/2021 13,500,000
================== ================= ========= ============ ==============
Admission and Total Voting Rights
The Company will apply to the London Stock Exchange for
admission of the Subscription Shares and the Settlement Shares to
AIM ("Admission"). Admission is expected to take place on or around
30 April 2019. Following Admission, the Company's issued share
capital will consist of 290,430,288 Ordinary Shares with no
Ordinary Shares held in treasury. Therefore, this figure may be
used by shareholders 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, Pathfinder under the
FCA's Disclosure Guidance and Transparency Rules.
Scott Richardson Brown, Chief Executive Officer of Pathfinder,
commented:
"The agreement between General Veloso and Pathfinder, subject to
the further work to firm up the optimal transaction structure for
Pathfinder shareholders to bring this to completion, should give
shareholders confidence that the return of this asset is now,
finally, on the near horizon. It reflects the considerable efforts
of the parties to work together towards a resolution in the
interests of all stakeholders. The Board's confidence in the
deliverability of a resolution is further reflected in the
directors' participation in the Subscription and Settlement Share
issue today at a 48 per cent premium to the closing mid market
price yesterday.
"The results of the revised scoping study report are compelling
and serve as a reminder of the opportunity for value creation from
the Licence."
Enquiries:
Pathfinder Minerals Plc
Scott Richardson Brown, Chief Executive Officer
Tel. +44 (0)20 3440 7775
Strand Hanson Limited (Nominated & Financial Adviser and
Broker)
James Spinney / Ritchie Balmer / Jack Botros
Tel. +44 (0)20 7409 3494
Vigo Communications (Public Relations)
Ben Simons / Simon Woods
Tel. +44 (0)20 7390 0234
Email. pathfinderminerals@vigocomms.com
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014 ("MAR").
PDMR Notification Forms
The notifications below are made in accordance with the
requirements of MAR.
1. Details of the persons discharging managerial responsibilities
/ person closely associated
a) Name Scott Richardson Brown
-------------------------- ---------------------------------------
2. Reason for the notification
-------------------------------------------------------------------
a) Position/status Chief Executive Officer
-------------------------- ---------------------------------------
b) Initial notification Initial notification
/ amendment
-------------------------- ---------------------------------------
3. Details of the issuer, emission allowance market participant,
auction platform, auctioneer or auction monitor
-------------------------------------------------------------------
a) Name Pathfinder Minerals PLC
-------------------------- ---------------------------------------
b) LEI 2138009YG6AG3K86TN77
-------------------------- ---------------------------------------
4. Details of the transaction(s): section to be repeated for
(i) each type of instrument; (ii) each type of transaction;
(iii) each date; and (iv) each place where transactions
have been conducted
-------------------------------------------------------------------
a) Description of the Ordinary Shares of 0.1 pence per share
financial instrument,
type of instrument
-------------------------- ---------------------------------------
Identification code GB00BYY0JQ23
-------------------------- ---------------------------------------
b) Nature of the transaction Participation in subcription
-------------------------- ---------------------------------------
c) Price(s) and volume(s) Share Price (GBX) Volume(s)
2.0 pence per share 1,250,000
----------
-------------------------- ---------------------------------------
d) Aggregated information N/A
- Aggregated volume
- Price
-------------------------- ---------------------------------------
e) Date of the transaction 10 April 2019
-------------------------- ---------------------------------------
f) Place of the transaction AIM, London Stock Exchange
-------------------------- ---------------------------------------
1. Details of the persons discharging managerial responsibilities
/ person closely associated
a) Name Scott Richardson Brown
-------------------------- ---------------------------------------
2. Reason for the notification
-------------------------------------------------------------------
a) Position/status Chief Executive Officer
-------------------------- ---------------------------------------
b) Initial notification Initial notification
/ amendment
-------------------------- ---------------------------------------
3. Details of the issuer, emission allowance market participant,
auction platform, auctioneer or auction monitor
-------------------------------------------------------------------
a) Name Pathfinder Minerals PLC
-------------------------- ---------------------------------------
b) LEI 2138009YG6AG3K86TN77
-------------------------- ---------------------------------------
4. Details of the transaction(s): section to be repeated for
(i) each type of instrument; (ii) each type of transaction;
(iii) each date; and (iv) each place where transactions
have been conducted
-------------------------------------------------------------------
a) Description of the Ordinary Shares of 0.1 pence per share
financial instrument,
type of instrument
-------------------------- ---------------------------------------
Identification code GB00BYY0JQ23
-------------------------- ---------------------------------------
b) Nature of the transaction Issue of Options
-------------------------- ---------------------------------------
c) Price(s) and volume(s) Share Price (GBX) Volume(s)
2.50 pence per share 7,500,000
----------
-------------------------- ---------------------------------------
d) Aggregated information N/A
- Aggregated volume
- Price
-------------------------- ---------------------------------------
e) Date of the transaction 10 April 2019
-------------------------- ---------------------------------------
f) Place of the transaction AIM, London Stock Exchange
-------------------------- ---------------------------------------
1. Details of the persons discharging managerial responsibilities
/ person closely associated
a) Name Sir Henry Bellingham
-------------------------- -----------------------------------------
2. Reason for the notification
---------------------------------------------------------------------
a) Position/status Non-Executive Co-Chairman
-------------------------- -----------------------------------------
b) Initial notification Initial notification
/ amendment
-------------------------- -----------------------------------------
3. Details of the issuer, emission allowance market participant,
auction platform, auctioneer or auction monitor
---------------------------------------------------------------------
a) Name Pathfinder Minerals PLC
-------------------------- -----------------------------------------
b) LEI 2138009YG6AG3K86TN77
-------------------------- -----------------------------------------
4. Details of the transaction(s): section to be repeated for
(i) each type of instrument; (ii) each type of transaction;
(iii) each date; and (iv) each place where transactions
have been conducted
---------------------------------------------------------------------
a) Description of the Ordinary Shares of 0.1 pence per share
financial instrument,
type of instrument
-------------------------- -----------------------------------------
Identification code GB00BYY0JQ23
-------------------------- -----------------------------------------
b) Nature of the transaction Issue of shares in settlement of accrued
fees
-------------------------- -----------------------------------------
c) Price(s) and volume(s) Share Price (GBX) Volume(s)
2.0 pence per share 1,250,000
---------------
-------------------------- -----------------------------------------
d) Aggregated information N/A
- Aggregated volume
- Price
-------------------------- -----------------------------------------
e) Date of the transaction 10 April 2019
-------------------------- -----------------------------------------
f) Place of the transaction AIM, London Stock Exchange
-------------------------- -----------------------------------------
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
MSCGGUQCCUPBGCU
(END) Dow Jones Newswires
April 10, 2019 10:49 ET (14:49 GMT)
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