TIDMCN.
RNS Number : 4725Q
Canisp PLC
03 August 2010
3 August 2010
Canisp plc
("Canisp" or the "Company")
Proposed Acquisition of Tri-Star*
Proposed Adoption of New Articles of Association
Proposed Reorganisation of Share Capital
Proposed Approval of a Waiver of the Obligations under Rule 9 of the Takeover
Code
Subscription for 3,100,000,000 Ordinary Shares of 0.005p each at 0.005p per
share
Change of Name to Tri-Star Resources plc
Notice of Annual General Meeting and Application for Admission to trading on AIM
The directors of Canisp (the "Directors") are pleased to announce that, further
to the announcement on 23 July 2010, the Company will today post a circular to
Shareholders seeking approval for, inter alia, the acquisition of 99 per cent.
of the issued ordinary share capital of Tri-Star, which holds a mining licence
and permits to explore for and produce antimony ore in the Gediz district of
Turkey, for a maximum consideration of GBP300,000 (the "Proposed Acquisition").
If Shareholder approval for the Proposed Acquisition is not obtained, the
Company's Ordinary Shares will be cancelled from trading on AIM. Further, if the
Proposed Acquisition does not proceed, the Directors will consider winding up
the Company, in which case, given the Company's cash position, it is unlikely
there will be any available funds for distribution to Shareholders. Earlier
today, the Company released its annual report and accounts for the year ended 31
March 2010, a copy of which will be made available on the Company's website,
www.canispplc.com.
Certain definitions and terms apply throughout this announcement and carry the
same meaning as those defined in the AIM admission document of the Company which
will shortly be issued in connection with the Proposed Acquisition and will also
available on the Company's website, later today.
Highlights:
· Tri-Star is incorporated in Turkey and holds a licence and permits to
explore for and produce antimony ore at the Goynuk antimony mine (the "Goynuk
Mine"), in the Gediz district of Turkey. The licence grants the Company the
right to exploit antimony.
· The strategy of Tri-Star is to evaluate the antimony mineral resource of
the Goynuk Mine through initial drilling and advanced geophysical techniques, to
provide evidence to the Board of its viability.
· If the antimony occurrence at the Goynuk Mine is proved to be of economic
significance, the Directors believe that having a deposit which constitutes an
alternative source to the material supplied by the main exporter, China, and
which is in closer proximity to key European customers will be of significant
strategic importance in the context of the wider European antimony market.
· The consideration is to be satisfied as to GBP150,000 payable in cash on
completion of the Proposed Acquisition, with a further GBP150,000 payable in
cash subject to certain milestones being achieved (the "Deferred
Consideration").
· The Deferred Consideration will be payable by the Company following: (i)
the provision of sufficient evidence relating to the commercial viability of the
Goynuk Mine; and (ii) the raising of funding sufficient to enable continued
development of the Goynuk Mine and to cover contractual obligations which would
arise from making that decision.
· In view of the nature of the Proposed Acquisition, it constitutes a
reverse takeover of the Company under the AIM Rules for Companies and therefore
requires the prior approval of Shareholders at the Annual General Meeting,
further details of which are set out below.
· The Company has entered into a facility agreement with EMMEF Investments
Limited ("EMMEF"), pursuant to which EMMEF will make available to the Company a
facility of GBP750,000 until 30 June 2011 and which falls due for payment by 30
June 2012, for the purpose of undertaking exploration of the Goynuk Mine, if
required.
· The Company has entered into a Subscription Agreement pursuant to which
it will raise GBP155,000 before expenses by the issue of Ordinary Shares at par.
· Subject to Completion, Canisp also announces proposals to change the
Company's name to Tri-Star Resources plc and effect a number of Board changes.
Mehmet Vehbi Eyi and Brian Spratley will join the Board as executive Directors
and Adrian Collins, Jos Trusted and Jonathan Quirk will join the Board as
non-executive Directors. On Completion, Joanna Unden will resign as a Director
and Michael Hirschfield will cease executive responsibilities and become a
non-executive Director.
· Strand Hanson is acting as financial and nominated adviser and KBR is
acting as broker in connection with the Proposed Acquisition.
Michael Hirschfield, Chairman of Canisp, today commented:
"I am delighted to supply Shareholders with notice of the Annual General Meeting
at which approval will be sought for the acquisition of Tri-Star and other
matters, and at the same time to issue the AIM admission document in connection
with the Proposed Acquisition and the Company's re-admission to AIM. The Board
believes that the acquisition of Tri-Star will give the Company the opportunity
to create significant future value for Shareholders. We believe that rare
minerals will be an increasingly important sector and are pleased that the
Proposed Acquisition, should it be approved by Shareholders, will give the
Company significant exposure to that sector."
The Company's AIM admission document containing a notice convening the Annual
General Meeting to be held at the offices of Fladgate LLP, 16 Great Queen
Street, London, WC2B 5DG at 11.00 a.m. on 26 August 2010 is being sent to
Shareholders today.
www.canispplc.com
*The full name of Tri-Star is Üç Yildiz Antimon Madencilik Ithalat Ve Ihracat
Sanayi ve Ticaret Anonim Sirketi.
Enquiries:
+-----------------------------------+-------------------------+
| Strand Hanson Limited (Nomad) | Tel: +44 (0)20 7409 |
| James Harris / Paul Cocker / Liam | 3494 |
| Buswell | |
+-----------------------------------+-------------------------+
| | |
| Keith, Bayley, Rogers & Co | Tel: +44 (0)20 3100 |
| Limited (Broker) | 8300 |
| Simon Frost / Brinsley Holman | |
+-----------------------------------+-------------------------+
| | |
| Hansard Communications | Tel: +44 (0)20 7245 |
| Justine James /John Bick | 1100 |
| | |
+-----------------------------------+-------------------------+
The summary above should be read in conjunction with the full text of this
announcement set out below.
Strand Hanson and KBR, which are both authorised and regulated in the United
Kingdom by the Financial Services Authority, are acting as financial and
nominated adviser and broker to the Company respectively in connection with the
Proposed Acquisition and the proposed Admission of the Enlarged Share Capital to
trading on AIM. Their responsibilities as the Company's nominated adviser and
broker under the AIM Rules for Companies and the AIM Rules for Nominated
Advisers are owed solely to the London Stock Exchange and are not owed to the
Company or to any Director or to any other person in respect of their decision
to acquire shares in the Company in reliance on any part of this announcement.
Strand Hanson and KBR are acting exclusively for Canisp and for no one else and
will not be responsible to anyone other than the Company for providing the
protections afforded to their clients or for providing advice in relation to the
contents of this announcement or the Proposed Acquisition or the proposed
Admission of the Enlarged Share Capital to trading on AIM. No representation or
warranty, express or implied, is made by either Strand Hanson or KBR as to the
contents of this announcement, without limiting the statutory rights of any
person to whom this announcement is issued. The information contained in this
announcement is not intended to inform or be relied upon by any subsequent
purchasers of Ordinary Shares (whether on or off exchange) and accordingly no
duty of care is accepted in relation to them.
The Directors accept responsibility, individually and collectively, for the
information contained in this announcement and for compliance with the AIM Rules
for Companies. To the best of the knowledge and belief of the Directors, who
have taken all reasonable care to ensure that such is the case, the information
contained in this announcement is in accordance with the facts and does not omit
anything likely to affect the import of such information.
This announcement does not constitute, or form part of, an offer or an
invitation to purchase any securities.
Not for release, publication or distribution in whole or in part in or into the
United States, Canada, Australia, the Republic of South Africa or Japan or any
other jurisdiction where it is unlawful to do so.
3 August 2010
Proposed Acquisition of Tri-Star
Proposed Adoption of New Articles of Association
Proposed Reorganisation of Share Capital
Proposed Approval of a Waiver of the Obligations under Rule 9 of the Takeover
Code
Subscription for 3,100,000,000 Ordinary Shares of 0.005p each at 0.005p per
share
Change of Name to Tri-Star Resources plc
Notice of Annual General Meeting and Application for Admission to trading on AIM
1. Introduction
On 23 July 2010, the Company announced that it had conditionally agreed to
acquire 99 per cent. of the issued share capital of Tri-Star for a maximum
consideration of GBP300,000, of which GBP150,000 is payable in cash on
completion of the Acquisition and a further GBP150,000 is payable in cash if and
when Tri-Star's exploration activities establish that the Goynuk mine is
commercially viable and the Company raises an amount of funding sufficient to
facilitate continued development of the mine and to cover current contractual
obligations which would arise from making that decision.
The principal activity of Tri-Star is the holding of licences and permits in
respect of the mining and exploitation of mineral rights, for antimony, at
Goynuk, located in the Gediz district of Turkey. For the reasons set out in the
section "Background to and reasons for the Acquisition" below, Tri-Star's
business provides a suitable investment opportunity for the Company, as the
Company can play an active role in providing both commercial experience and
access to capital markets in order to meet future funding requirements, enabling
Tri-Star to successfully exploit the permits and licences it holds in respect of
the Goynuk antimony mine.
In order to provide funding for the acquisition of Tri-Star, the Company
proposes to immediately raise GBP155,000 before expenses through the
subscription for 3,100,000,000 New Ordinary Shares from the Subscribers at the
Subscription Price. On Completion, the Subscribers, who include Mr Mehmet Vehbi
Eyi, one of the Sellers, will own, in aggregate, 77.62 per cent. of the Enlarged
Share Capital. Subsequently, the Company intends to raise up to GBP750,000 by
way of the Proposed Placing or if this does not proceed, by using the EMMEF
Facility, further details of which are set out below.
Under the EMMEF Facility, the Company has a borrowing facility of up to
GBP750,000 available until 30 June 2011 for the purpose of undertaking
exploration of the Goynuk resource. Interest is payable quarterly at the rate of
LIBOR plus five per cent. The EMMEF Facility will be secured by a charge over
the issued shares of Tri-Star held by the Company. The loan is repayable on 30
June 2012.
In view of the size and nature of the Acquisition, which constitutes a reverse
takeover of the Company under the AIM Rules for Companies, completion of the
Acquisition is conditional, inter alia, on receiving the approval of
Shareholders, such approval to be sought at the AGM. In addition, as a
consequence of the Concert Party acquiring the Subscription Shares, Shareholders
are being asked to waive the obligations of the Concert Party under Rule 9, at
the AGM.
The purpose of this announcement is to provide summary information on the
Proposals and to explain why the Directors consider the Proposals to be in the
best interests of the Company and Shareholders as a whole and recommend that
Shareholders vote in favour of the Resolutions to be proposed at the AGM.
If the Resolutions are duly passed at the AGM, the Company's existing trading
facility on AIM will be cancelled and the Company will apply for the Enlarged
Share Capital to be admitted to trading on AIM. If the Resolutions are not
passed at the AGM, the Existing Ordinary Shares will be cancelled from trading
on AIM pursuant to Rule 41 of the AIM Rules for Companies.
Irrevocable undertakings to vote in favour of the Resolutions have been received
from certain of the Directors and Shareholders in respect of 320,687,914
Existing Ordinary Shares, representing approximately 37.44 per cent. of the
Company's existing issued share capital.
Shareholders should note that the Proposals are inter-conditional. It is
expected that Admission will take place and that dealings in the New Ordinary
Shares will commence on 27 August 2010.
2. The Company and its Investing Policy
Since 31 March 2009, the Company has had no substantive trading business,
following the disposal of the business and assets of its subsidiary, The Airtime
Group Limited. Since that date, the Company has been classified as an investing
company under the AIM Rules for Companies. The Company's Investing Policy since
its general meeting on 30 March 2009 has been to invest in technology companies,
with initial consideration of such companies in the UK and Europe, although
investments in other sectors were also considered. No viable opportunities have
arisen and therefore, when the opportunity arose to acquire Tri-Star, the
Directors considered it represented a suitable investment opportunity albeit
outside its stated Investing Policy. Following the Acquisition, the Company will
no longer be an investing company. If the Acquisition does not proceed, the
Directors will consider winding up the Company, in which case, given the
Company's cash position, it is unlikely there will be any available funds for
distribution to Shareholders.
3. Background to and reasons for the Acquisition
As set out above, the Company's primary objective is to act as an investing
company. Given the Company's limited financial resources, the Directors believe
that the Acquisition represents a suitable investment opportunity and one where
the Company can play an active role, in terms of providing both commercial
experience and access to capital markets, to potentially provide future
resources to support Tri-Star in its objective to exploit the permits and
licences it holds in respect of the Goynuk antimony mine. The first stage in
this process is to raise sufficient funds to carry out a detailed geological
review of the mine area, with a view to assessing the potential viability of
mineral deposits. If this process, as is expected, provides positive evidence
regarding the viability of the mine, the Company will seek further funding to
enable the Company to develop the resource. In the event that the geological
review does not provide such positive evidence, the Directors will consider
winding up the Company, in which case, given the Company's cash position, it is
unlikely there will be any available funds for distribution to Shareholders.
4. Information on Tri-Star
Principal activity
The principal activity of Tri-Star is the holding of licences and permits in
respect of the mining and exploitation of mineral rights at Goynuk, located in
the Gediz district of Turkey.
History and background of Tri-Star
Tri-Star was incorporated on 7 August 2008. Tri-Star is 90 per cent. owned by
Mr. Vehbi Eyi, with a 10 per cent. interest held by Mr. Nizamettin Coban who had
been connected with the previous owner of the mining licence. Three further
shareholders hold nominal numbers of shares, in order to comply with the Turkish
legal requirement for a joint stock company to have five shareholders. The
licences held by Tri-Star are valid until 10 June 2015. The 2005 operation
permit was for 46.68 hectares, but was reduced to 24.62 hectares in late 2008
for antimony. The Company may explore for other base and precious metals such as
copper, lead, zinc, arsenic, gold and silver but would need additional licence
rights to exploit any such minerals.
Business model and strategy of Tri-Star
The strategy of Tri-Star is to evaluate the antimony (Sb) mineral resource and,
through drilling and advanced geophysical techniques, to provide evidence to the
Board of its viability. The next objective will be the preparation of a detailed
engineering feasibility study with a view to developing
the resource.
On the basis that the geological assessment of the site is successful, and
subject to raising additional funding, the products that Tri-Star intends to
produce are antimony metal ingots and bars, antimony trioxide powder and
antimony concentrates and ores.
Tri-Star initially intends to market these products to regional consumers such
as automotive battery manufacturers (antimony metal) and to glass and tile
manufacturers (trioxide products). It is Tri-Star's strategy to produce a
consistent quality product that can then be exported to large European and Gulf
State markets for use by chemical and flame retardant product manufacturers.
Goynuk antimony mine
The Goynuk antimony mine is located in forested and ruggedly mountainous terrain
in western Turkey, approximately 30 kilometres east of the city of Gediz
district in Kutahya province.
The Goynuk Mine is a low temperature, low sulphidation and epithermal deposit,
rich in antimony and arsenic, along with traces of gold. The deposit is exposed
in an erosional window beneath an overthrust conglomerate unit. The deposit has
not been traced out laterally or to depth by drilling, and the overall shape and
size are undetermined. The deposit is comprised of brecciated and strongly
silicified limestone, and felsic igneous rocks of unknown origin (either an
intrusive plug or an ash flow tuff). The protoliths are impregnated by powdery
sulphides, principally pyrite. Stibnite is the only mineral of current economic
interest, and occurs as chutes, pockets and veinlets occupying open spaced
fractures and carbonate dissolution (hydrothermal karst) features. Past
production focused on the richer stibnite pockets and chimneys. Sampling of
outcrops, drifts and wastepiles suggests that the remaining host rocks contain,
in places, more than 0.5 per cent. (11 pounds per tonne) antimony and that if
higher grade pockets, balls and chutes comparable to past production exist in
unexplored portions of the deposit, overall grades may average greater than one
per cent. antimony.
A recent induced polarisation geophysical survey has indicated a roughly tabular
drill target within 100 metres of the surface. Each side of the tablet is
approximately 200 metres long, with an average thickness of 50 metres. Other
unexposed targets with similar geophysical characteristics occur elsewhere on
the property and should also be explored by drilling.
Despite a history of more than a hundred years of intermittent artisanal
production, the Goynuk deposit is poorly explored and has possibilities as an
economically viable open pit antimony deposit. Theoretical considerations
suggest that there may be some potential for gold mineralisation peripherally,
or at depth.
Antimony
Antimony is an important mineral for the global economy but it is also
relatively rare. In a recent EU report on critical raw materials, antimony is
considered to be of high relative economic importance and high relative supply
risk. The supply risk is mainly due to the fact that the bulk of the world's
known reserves are located in China. China has stopped accepting applications
for new mines to produce antimony until June 2011 in order to conserve
resources. It is of high economic importance due to the lack of substitutes and
low recycling rates. MetalFirst Antimony Metal News reported in April 2010 that
antimony prices had soared by as much as US$700 per tonne and some EU member
states have indicated their support for a suspension of import duties payable on
antimony. The US Geological Survey ("USGS") estimates that global reserves of
antimony are 2.1 million tonnes and that annual mine production in 2009 was
estimated to be 187,000 tonnes, of which over 90 per cent. was produced in
China. This suggests a reserve life ratio of approximately nine years. The
reserves in China itself are estimated by the USGS to be 790,000 tonnes, or the
equivalent of under five years of reserve life ratio. Furthermore, there are
more resources in China and globally that can be brought into production given
time and favourable metal pricing economics. However, the overall reserve life
of an important metal of approximately 11 years is very low (copper is estimated
to be around 34 years for example). The consumption of antimony, predominantly
in the form of its trioxide salts as a flame retardant, is a structurally
expanding market, driven mostly by safety and regulatory concerns. Volume demand
for the metal and its compounds have risen steadily over the past decade, on
average by 5-7 per cent. per annum.
After several years of steady global growth, both production and average US
prices peaked in 2008, at 197,000 tonnes and US$2.80 per pound (US$6.17 per
kilogram) respectively, prior to global commodities collapsing later in the
year. Preliminary data (Carlin, 2010) indicates that global production in 2009
declined to 187,000 tonnes, with an average price of US$2.30 per pound (US$5.07
per kilogram). Prices have risen steadily since then, from a low of US$1.93 per
pound (US$4.26 per kilogram) in January 2009, to approximately US$4.20 per pound
(US$9.25 per kilogram) as at 16 July 2010.
In 2008, the last year for which complete international production figures are
available, China dominated global production with a 91 per cent. share, followed
by Bolivia and Russia with two per cent. each. Turkey, with less than 0.5 per
cent. of global production, is in seventh place. Primary antimony production
comes from nine countries, as shown below (2008 data, in metric tonnes):
+------------+---------+
| China | 180,000 |
+------------+---------+
| Bolivia | 3,500 |
+------------+---------+
| Russia | 3,500 |
+------------+---------+
| South | 2,800 |
| Africa | |
+------------+---------+
| Tajikistan | 2,000 |
+------------+---------+
| Australia | 1,500 |
+------------+---------+
| Turkey | 1,300 |
+------------+---------+
| Guatemala | 1,000 |
+------------+---------+
| Peru | 810 |
+------------+---------+
| Others | 107 |
+------------+---------+
The principal antimony ore mineral is stibnite, a compound of antimony and
sulphur (Sb2S3). After either smelting or roasting, the stibnite is converted
and sold into international markets respectively as antimony metal or as
antimony trioxide. Metallic antimony is principally employed in lead-antimony
alloys used in ammunition, printing presses, anti-friction bearings, automotive
batteries, cable sheaths, corrosion resistant pumps and pipes, roof sheet solder
and tank linings. Lead-acid batteries were once the major antimony use, but the
advent of maintenance-free batteries has resulted in a drastic decrease in
demand from this application. This is counterbalanced by the fact that since
lead batteries are universally recycled, there is little recycled antimony
entering the market. Antimony trioxide is used to enhance the flame-retarding
properties of rubber, textiles, plastics and other combustibles. Antimony is
also used as a decolorising and refining agent in the manufacturing of some
forms of glass, especially optical quality glass. The current applications of
antimony (USA data), in order of importance, are as flame retardants (40 per
cent.), transportation, including batteries (22 per cent.), chemicals (14 per
cent.), ceramics and glass (11 per cent.), with the remaining applications
accounting for 13 per cent.
If the antimony occurrence at Goynuk is proved to be of economic significance,
having a deposit which is an alternative to the material supplied by China and
in closer proximity to key European customers could be of significant strategic
importance in the context of the European antimony market. The substitution of
antimony compounds in certain uses and markets is technically feasible. However,
alternative compounds such as tin oxides, known to be useful in certain aspects
of flame retardants, trade at metal prices nearer US$18,000 per tonne, compared
with antimony at US$8,300 per tonne. This provides further evidence as to the
commercial application of antimony.
Turkey and its mining industry
Turkey has a modern mining law that encourages responsible mining. All
subsurface mineral rights belong to the nation. The mineral rights may be leased
as exploration or exploitation concessions for 10 years and are renewable for 10
year periods. Periodic progress reports must be filed with the Turkish
government and there is a requirement to pay annual licence fees.
Turkey views mining as an "engine of national growth" and this encourages mining
that is carried out in a responsible manner. Mining activities in Turkey are
required to adhere to both European and international standards. Permits are
needed to explore and/or mine in national forests and good husbandry of the land
is expected, with the requirement for adequate compensation for any surficial
damages to either public or private lands. Environmental impact statements are
required for all scales of mining operations, although regulations applicable to
"small mine operations" such as currently exists at Goynuk, under 50,000 tonnes
of production per year, have special exemptions.
5. Directors, Proposed Directors, senior management and employees
The current composition of the Board is as follows:
Michael Hirschfield BSc (Econ), FCA, Chairman, aged 46, qualified as a Chartered
Accountant with Peat Marwick in 1988. He has held senior management positions
with a number of companies including group finance director of Utilitec plc and
group finance executive of Lupus Capital plc. He is currently a director of
Sirius Petroleum plc, a company whose shares are traded on AIM as well as of a
number of private companies including Kitwell Consultants Limited, which acts as
company secretary to several listed companies including the Company. Mr
Hirschfield was appointed director on 18 December 2003 and on Completion, Mr
Hirschfield will become a non-executive director.
Joanna Unden, Non Executive Director, aged 43, has 26 years experience in the
finance industry, both in the money markets and metal exchanges. Prior to 2008,
Mrs Unden worked for 15 years in the offshore financial services industry,
specialising in the establishment and running of trust and fiduciary structures.
This role involved acting on behalf of high net worth clients in both equity and
structured finance investments. Mrs Unden was appointed a director on 21
September 2009 and will resign as a Director of the Company on Completion.
Proposed Directors
On Completion, it is intended that Adrian Collins, Jos Trusted and Jonathan
Quirk will be appointed to the Board as Non Executive Directors, Mehmet Vehbi
Eyi (the founder of Tri-Star) will be appointed to the Board as an Executive
Director and Brian Spratley will be appointed to the Board as an Executive
Director and Chief Executive.
Adrian Collins, proposed Non Executive Chairman, aged 56, was previously a
director of Strand Hanson Limited (previously Strand Partners Limited), a
leading London-based corporate finance advisory firm and has worked in the fund
management sector for over 30 years, a large part of which was spent at Gartmore
Investment Management, where latterly he was a Managing Director. Adrian was one
of the founders of Trustnet.com, a leading provider of Fund performance
information on the Internet. He is currently on the board of a number of public
and private companies in the United Kingdom and overseas. He is chairman of Lion
Trust Asset Management plc as well as a non-executive director of Hiscox
Investment Management Limited and City Natural Resources High Yield Trust plc.
Jos Trusted, proposed Non Executive Director, aged 39, has spent 15 years in
investment banking. Jos began his career as a solicitor with K&L Gates, before
moving to the investment banking team at Dresdner Kleinwort Benson. Jos spent
the majority of his career at UBS, where he was a director, before moving to
Kaupthing Bank in 2006 to assist in the establishment of the UK equities
division. Jos has advised a number of FTSE clients including Next, Kingfisher,
Carnival and Centrica, but has latterly spent more time focusing on smaller
businesses, including a number of mining companies including Marcona Mining,
Peru. Jos is currently working in investment management.
Jonathan Quirk, proposed Non-Executive Finance Director, aged 58, is a Chartered
Accountant. He has worked in the financial services sector since 1974 for, among
others, Morgan Grenfell and Deutsche Bank in their capital markets divisions.
Since 1997 he has been a founding director of Cairnsea Investments Ltd, an FSA
regulated investment manager specialising in quoted and unquoted smaller
companies particularly in the financial services sector.
Mehmet Vehbi Eyi, proposed Executive Director, aged 68, graduated from the
Academy of Commerce and Science in Ankara, Turkey. He moved to the UK in 1968
and started his career working for a metal trading company where he specialised
in minor metals. Mr Eyi worked for an associate member of the LME. In 1993, he
established Vemetalco Limited to conduct proprietary trading in minor and
speciality metals, specialising in antimony and its co-products. In 2006
Vemetalco Limited was dissolved after trading assets had been distributed to Mr
Eyi as its proprietor. Mr Eyi continued as an active investor and trader in
metals and, in 2008, he established a controlling interest in Tri-Star.
Brian Spratley, proposed Executive Director and Chief Executive, aged 60 is a
mining engineer with over 38 years experience in the mining industry and is
currently (and until the end of August 2010) the Chief Operating Officer of PT
Artha Nusantara Mining in Indonesia. He has held various positions within
international mining groups, including Lundin Group (1995-2003), Crew Gold
Corporation (2003-2008) and Grängesberg Iron Ore plc (2008). He has worked in
many commodities globally, primarily in a project development role, from
exploration and studies through to engineering, construction and operations. His
background in the corporate development of junior and mid-tier mining companies
is a natural fit for the Company.
Senior management
Other than the Directors and Proposed Directors, there are no key senior
management personnel within the Enlarged Group.
Employees
The existing employment rights, including pension rights, of all the management
and employees of Tri-Star will remain unchanged and will be fully safeguarded
following Completion.
6. Principal terms of the Acquisition
Pursuant to the Acquisition Agreement, the Company has agreed conditionally to
purchase 99 per cent. of the issued share capital of Tri-Star from the Sellers.
The purchase price is payable as to GBP150,000 in cash on completion of the
Acquisition and a further GBP150,000 in cash if and when Tri-Star's exploration
activities provide sufficient evidence for the Board to consider that the Goynuk
mine is commercially viable and the Company raises an amount of funding
sufficient to facilitate continued development of the mine and cover current
contractual obligations which would arise from making that decision.
The Sellers and the other shareholders of Tri-Star, their current holdings in
Tri-Star and the aggregate amount of cash consideration to be paid to them,
assuming the deferred consideration is paid, are as follows:
+--------------------+--------------+----------+---------------+---------------+
| | | | | Deferred |
+--------------------+--------------+----------+---------------+---------------+
| | Shares in | Shares | | Conditional |
| | Tri-Star | in | Initial | Consideration |
| | | Tri-Star | consideration | (GBP) |
| | | being | | |
| | | sold | (GBP) | |
+--------------------+--------------+----------+---------------+---------------+
| Mehmet Vehbi Eyi | 447 | 446 | 135,150 | 135,150 |
+--------------------+--------------+----------+---------------+---------------+
| Nizamettin Coban | 50 | 49 | 14,850 | 14,850 |
+--------------------+--------------+----------+---------------+---------------+
| Ahmet Kinay | 1 | Nil | Nil | Nil |
+--------------------+--------------+----------+---------------+---------------+
| Necla Kinay | 1 | Nil | Nil | Nil |
+--------------------+--------------+----------+---------------+---------------+
| Hamit Yapindi | 1 | Nil | Nil | Nil |
| | | | | |
+--------------------+--------------+----------+---------------+---------------+
| Total | 500 | 495 | 150,000 | 150,000 |
| | | | | |
+--------------------+--------------+----------+---------------+---------------+
Under the Acquisition Agreement, the shareholders of Tri-Star have given title
warranties to the Company in respect of their shares in Tri-Star. In addition,
Mr Eyi has given commercial warranties and indemnities (subject to certain
limitations) appropriate to a transaction of the size and nature of the
Acquisition, relating to the business and assets of Tri-Star.
Mr Eyi has given non-compete and non-solicitation undertakings in respect of the
activities currently carried on by Tri-Star for a period of two years from
Completion.
The Acquisition Agreement is conditional on, inter alia, the following:
1. the passing of those of the Resolutions at the AGM necessary to
approve the purchase of the shares in Tri-Star and to authorise the Company to
issue the Subscription Shares;
2. the Introduction Agreement becoming unconditional except for any
conditions relating to the completion of the Acquisition Agreement and
Admission;
3. confirmation in a form reasonably acceptable to the Company that:
3.1 all the share capital of Tri-Star is fully paid;
3.2 all applicable stamp duty in respect of assignment of the debt owed by
Tri-Star to Windmark Trading Limited to Mr Vehbi Eyi has been paid to the
relevant Turkish authority;
3.3 the benefit of the debt owed by Tri-Star to Windmark Trading Limited
has been assigned to Mr Vehbi Eyi;
3.4 on or immediately following Completion the Company will be debt free
(except as owed to Mr Vehbi Eyi); and
4. immediately prior to Completion a search being carried out at the Mining
Registry of Turkey in respect of the licences held by Tri-Star, the results of
which are reasonably satisfactory to the Company.
7. Details of the Subscription, Proposed Placing, EMMEF Facility and use of
proceeds
The Company is proposing to issue 3,100,000,000 Subscription Shares pursuant to
the Subscription at the Subscription Price to raise GBP155,000 before expenses.
The Company subsequently intends to carry out the Proposed Placing or draw down
under the EMMEF Facility. This would give gross proceeds of GBP905,000
(GBP632,000 net of expenses).
The Subscription Price has been established in recognition of the Company's net
liability position and in light of its cash and financial obligations. The
Directors do not believe that the share price of the Existing Ordinary Shares
reflects the current value of the Company and on a winding up, in the absence of
the completion of the Proposals, given the Company's cash position, it is
unlikely there will be any funds available for distribution to the Shareholders.
The net proceeds of the Subscription and the Proposed Placing, together with
existing cash resources, will be used for general working capital purposes and
to carry out exploration work.
Only Ordinary Shares that have been unconditionally allotted can be admitted as
AIM securities.
The Subscribers include Mr Vehbi Eyi, one of the Sellers, and members of his
family who are to subscribe for New Ordinary Shares under the Subscription.
Following the Subscription, Mr Emin Eyi, his mother Cemile Eyi and his father Mr
Vehbi Eyi will hold 2,860,000,000 New Ordinary Shares, representing 71.61 per
cent. of the Enlarged Share Capital. Vehbi Eyi, Cemile Eyi and Emin Eyi are
treated as acting in concert for the purpose of the Takeover Code.
The Relationship Agreement regulates the relationship between the Eyi family,
their associates and the Enlarged Group on an arm's length and normal commercial
basis.
Emin Eyi is a member of SPACF, a limited liability partnership that provides
corporate finance advice. SPACF is an appointed representative of Helvetia Asset
Management Limited and is regulated by the FSA. SPACF is not engaged to act as
an adviser to the Company, the Subscribers or the Sellers in relation to the
Proposals.
Certain of the Subscribers are either fellow members of SPACF with Emin Eyi, or
employees or otherwise connected with SPACF, and hence also have a relationship
with Emin Eyi as a member of SPACF. On completion of the Subscription, they will
together hold 160,000,000 New Ordinary Shares, which when added to the holdings
of the Eyi Family Members, will total 3,020,000,000 New Ordinary Shares,
representing 75.61 per cent. of the Enlarged Share Capital.
The other Subscribers have indirect connections with SPACF and Emin Eyi, and
their participation in the Subscription is intended as recognition of their
ability to lend assistance in the development of the Enlarged Group. There are
no agreements or arrangements between the members of the Concert Party and these
other Subscribers that would cause them to be included within the Concert Party.
Together, the ten other Subscribers will subscribe for an aggregate of
20,000,000 New Ordinary Shares, which represents 0.50 per cent. of the Enlarged
Share Capital.
Brian Spratley, one of the Subscribers, is to become an executive director of
the Company. His invitation to participate as a Subscriber is in recognition of
his contribution to the future development of the Company. He is not a member of
the Concert Party.
After the Subscription, the Subscribers will hold the following number of New
Ordinary Shares:
+--------------------------------------------+---------------+------------+
| | No. of | Percentage |
| | Subscription | of |
| | | Enlarged |
+--------------------------------------------+---------------+------------+
| Name of Holder | Shares | Share |
| | | Capital |
+--------------------------------------------+---------------+------------+
| Emin Eyi | 1,560,000,000 | 39.06 |
+--------------------------------------------+---------------+------------+
| Cemile Eyi | 800,000,000 | 20.03 |
+--------------------------------------------+---------------+------------+
| Mehmet Vehbi Eyi | 500,000,000 | 12.52 |
+--------------------------------------------+---------------+------------+
| Brian Spratley | 60,000,000 | 1.50 |
+--------------------------------------------+---------------+------------+
| PMA Nominees Limited1 | 10,000,000 | 0.25 |
+--------------------------------------------+---------------+------------+
| John Mackay | 69,100,000 | 1.73 |
+--------------------------------------------+---------------+------------+
| Robert Wooldridge | 69,100,000 | 1.73 |
+--------------------------------------------+---------------+------------+
| Bruce Fraser | 2,000,000 | 0.05 |
+--------------------------------------------+---------------+------------+
| Simon Bishop | 2,000,000 | 0.05 |
+--------------------------------------------+---------------+------------+
| Tercel Moore | 2,000,000 | 0.05 |
+--------------------------------------------+---------------+------------+
| Christopher Couldrey | 2,000,000 | 0.05 |
+--------------------------------------------+---------------+------------+
| Terry Gracey | 1,000,000 | 0.03 |
+--------------------------------------------+---------------+------------+
| Alexandra MacKinnon | 1,000,000 | 0.03 |
+--------------------------------------------+---------------+------------+
| David Facey | 900,000 | 0.02 |
+--------------------------------------------+---------------+------------+
| John Sleeman | 900,000 | 0.02 |
| | | |
+--------------------------------------------+---------------+------------+
| Other investors | 20,000,000 | 0.50 |
| | | |
+--------------------------------------------+---------------+------------+
| Total | 3,100,000,000 | 77.62 |
| | | |
+--------------------------------------------+---------------+------------+
¹ PMA Nominees Limited is to hold Ordinary Shares as nominee for the partners of
Pritchard Englefield, Solicitors.
The Subscribers have undertaken not to dispose of their Subscription Shares for
the period of one year from the date of Completion, except in limited
circumstances, including, but not limited to, the receipt of a general offer for
the entire issued share capital of the Company, death or an intervening court
order. On the expiry of this initial lock-in period, the Subscribers have
undertaken only to dispose of their Subscription Shares through the Company's
broker, with its consent and that of the Company's nominated adviser for a
further 12 month period.
The Subscription Shares will represent approximately 77.62 per cent. of the
Enlarged Share Capital of the Company following Admission, be fully paid and
rank pari passu with the New Ordinary Shares in issue at Completion.
On Completion, the Directors and Proposed Directors will hold, in aggregate,
14.65 per cent. of the Enlarged Share Capital.
Current trading and prospects
The Company will undertake a fundraising to finance, together with existing cash
resources, a detailed survey exercise and test drilling program to establish the
extent and quality of the antimony resource and to identify any other mineral
resources present at the mine site. This will enable the Company to establish an
estimated in the ground value of the mineral resources available at the mine.
Historic financial information
Audited financial information of the Company for the three years to 31 March
2010 is available from the Company's website at www.canispplc.com.
Capital Reorganisation
The Company is proposing to subdivide each Existing Ordinary Share into one New
Ordinary Share and one New Deferred Share. The Capital Reorganisation is
required to ensure that the value of the Subscription Shares accurately reflects
the value of the assets of Tri-Star being purchased under the Acquisition
subject to the resolutions being passed. The Articles will be amended to reflect
the New Deferred Shares, which will have the same rights as the existing
Deferred Shares. The Deferred Shares do not carry the right for the holder to
receive notice of, or attend meetings of the Company, the holder will have no
right to receive dividends; the Deferred Shares are not redeemable; and the
Directors are authorised to transfer all the Deferred Shares to any person they
may determine for a total price of one penny.
8. Dividend Policy
The Ordinary Shares rank equally for all dividends and other distributions
declared, paid or made in respect of the Ordinary Share capital of the Company.
The Company has not paid any dividends since incorporation.
It is the current intention of the Directors and Proposed Directors to retain
any earnings arising from the Group's activities to fund further investments by
the Enlarged Group and achieve capital growth. Accordingly, they do not intend
to pay dividends in the immediate future. The declaration and payment by the
Company of any future dividends and their amount will depend upon the Company's
financial condition, future prospects, profits legally available for
distribution and other factors deemed by the Board to be relevant at that time.
9. Lock-in and orderly market arrangements
On Completion, the Subscribers will be interested in approximately 77.62 per
cent. of the Enlarged Share Capital. Each of the Subscribers, Directors and
Proposed Directors have undertaken to the Company, Strand Hanson and KBR that,
except in certain limited circumstances, they will not dispose of any interest
in the Ordinary Shares held by them for a period of 12 months from the date of
Admission and, for the 12 months following that period, that they will only
dispose of their holdings with the consent of the Company's broker and nominated
adviser from time to time.
10. Share Option Plan
The Board believe that it is important that Directors, employees of, and
consultants to the Company are appropriately and properly motivated and
rewarded. Accordingly, the Board intends to introduce a share option plan which
will initially be used to grant options to Michael Hirschfield following
Admission. It is expected that the number of Ordinary Shares under option will
not exceed ten per cent. of the Company's issued capital from time to time.
11. The Takeover Code
The issue of the Subscription Shares to the Concert Party gives rise to certain
considerations under the Takeover Code. Brief details of the Takeover Panel, the
Takeover Code and the protections they afford to Shareholders are described
below.
The Takeover Code is issued and administered by the Takeover Panel. The Company
is a company to which the Takeover Code applies and its shareholders are
entitled to the protection afforded by the Takeover Code.
Under Rule 9 of the Takeover Code, any person who acquires an interest (as
defined in the Takeover Code) in shares which, taken together with shares in
which he is already interested and in which persons acting in concert with him
are interested, carry 30 per cent. or more of the voting rights of a company
which is subject to the Takeover Code, is normally required to make a general
offer to all the remaining shareholders to acquire their shares.
An offer under Rule 9 must be made in cash and at the highest price paid by the
person required to make the offer, or any person acting in concert with him, for
any interest in shares of the Company during the 12 months prior to the
announcement of the offer.
The members of the Concert Party are deemed to be acting in concert for the
purpose of the Takeover Code. On completion of the Subscription the members of
the Concert Party will between them be interested in 3,020,000,000 Ordinary
Shares, representing approximately 75.61 per cent. of the Company's enlarged
issued voting share capital.
The Panel has agreed, however, to waive the obligation to make a general offer
that would otherwise arise as a result of the Subscription, subject to the
approval of independent shareholders. Accordingly, Resolution 5 is being
proposed at the Annual General Meeting, and will be taken on a poll. Those
persons disenfranchised from voting will not be entitled to vote on Resolution
5.
Following completion of the Subscription, the members of the Concert Party will
between them hold more than 50 per cent. of the Company's voting share capital
and (for so long as they continue to be treated as acting in concert) may
accordingly increase their aggregate interests in shares without incurring any
further obligation under Rule 9 to make a general offer, although individual
members of the Concert Party will not be able to increase their percentage
interests in shares through or between a Rule 9 threshold without Panel consent.
No member of the Concert Party currently holds Ordinary Shares.
A table showing the interests in New Ordinary Shares of the members of the
Concert Party on Admission, subject to passing of the Resolutions, is as set out
below:
+--------------------------------------------+-------------------+------------+
| | No. of | Percentage |
| | Subscription | of |
| | | Enlarged |
+--------------------------------------------+-------------------+------------+
| Name of Holder | Shares | Share |
| | | Capital |
+--------------------------------------------+-------------------+------------+
| Emin Eyi | 1,560,000,000 | 39.06 |
+--------------------------------------------+-------------------+------------+
| Cemile Eyi | 800,000,000 | 20.03 |
+--------------------------------------------+-------------------+------------+
| Mehmet Vehbi Eyi | 500,000,000 | 12.52 |
+--------------------------------------------+-------------------+------------+
| PMA Nominees Limited¹ | 10,000,000 | 0.25 |
+--------------------------------------------+-------------------+------------+
| John Mackay | 69,100,000 | 1.73 |
+--------------------------------------------+-------------------+------------+
| Robert Wooldridge | 69,100,000 | 1.73 |
+--------------------------------------------+-------------------+------------+
| Bruce Fraser | 2,000,000 | 0.05 |
+--------------------------------------------+-------------------+------------+
| Simon Bishop | 2,000,000 | 0.05 |
+--------------------------------------------+-------------------+------------+
| Tercel Moore | 2,000,000 | 0.05 |
+--------------------------------------------+-------------------+------------+
| Christopher Couldrey | 2,000,000 | 0.05 |
+--------------------------------------------+-------------------+------------+
| Terry Gracey | 1,000,000 | 0.03 |
+--------------------------------------------+-------------------+------------+
| Alexandra MacKinnon | 1,000,000 | 0.03 |
+--------------------------------------------+-------------------+------------+
| David Facey | 900,000 | 0.02 |
+--------------------------------------------+-------------------+------------+
| John Sleeman | 900,000 | 0.02 |
| | | |
+--------------------------------------------+-------------------+------------+
| Total | 3,020,000,000 | 75.61 |
| | | |
+--------------------------------------------+-------------------+------------+
¹ PMA Nominees Limited is to hold shares as nominee for the partners of
Pritchard Englefield, Solicitors
The Takeover Panel has agreed however, subject to Resolution 5 being passed (on
a poll) by the Shareholders at the Annual General Meeting, to waive the
obligations on the Concert Party under Rule 9 of the Takeover Code to make a
general offer for the entire issued share capital of the Company which would
otherwise arise as a result of the Proposals. Accordingly, approval of the
Shareholders (on a poll) to the Waiver is sought in Resolution 5.
Shareholders should note that, if Resolution 5 is passed, the Concert Party
would between them be interested in New Ordinary Shares carrying more than 50
per cent. of the voting rights of the Company and, for as long as they continue
to be treated as acting in concert, would be able to acquire further New
Ordinary Shares, without incurring an obligation to make an offer to
shareholders of the Company under Rule 9 of the Takeover Code, although
individual members of the Concert Party will not be able to increase their
percentage interests in shares through 30 per cent. or between 30 and 50 per
cent. of the voting rights of the Company without Takeover Panel consent.
12. Irrevocable Undertakings
The Company has received irrevocable undertakings from the Directors and certain
significant Shareholders to vote in favour of the Acquisition and the other
Resolutions in respect of, in aggregate, 320,687,914 Existing Ordinary Shares,
representing approximately 37.44 per cent. of the Company's existing issued
Ordinary Share capital.
13. Admission Document
The Company's AIM admission document setting out full details of the Proposals
and including a notice of the Annual General Meeting, accompanied by the Form of
Proxy, will be posted to Shareholders today. Copies of the Company's AIM
admission document will also be available to the public free of charge from
today at the offices of Fladgate LLP, 25 North Row, London W1K 6DJ (until 6
August 2010 and thereafter at 16 Great Queen Street, London, WC2B 5DG), during
normal business hours on any weekday (other than Saturdays, Sundays and public
holidays), for a period of at least one month following the date of Admission.
The document will also be made available to download from the Company's website
at www.canispplc.com.
Expected Timetable of Principal Events
+----------------------------------------+----------------------------+
| Publication of this document | 3 August 2010 |
+----------------------------------------+----------------------------+
| | |
| Payment to be received from the | 11.00 a.m. GMT on 26 |
| Subscribers (other than through CREST) | August 2010 |
| pursuant to the Subscription (in | |
| cleared funds) | |
+----------------------------------------+----------------------------+
| | 11.00 a.m. GMT on 24 |
| Latest time and date for receipt of | August 2010 |
| forms of proxy | |
+----------------------------------------+----------------------------+
| | 11.00 a.m. GMT on 26 |
| Annual General Meeting | August 2010 |
+----------------------------------------+----------------------------+
| | 27 August 2010 |
| Completion of the Proposed | |
| Acquisition, Admission effective and | |
| dealings expected to commence in the | |
| Enlarged Share Capital on AIM | |
+----------------------------------------+----------------------------+
| | 27 August 2010 |
| CREST accounts expected to be credited | |
| in respect of Subscription Shares | |
+----------------------------------------+----------------------------+
| | 10 September 2010 |
| Definitive share certificates for the | |
| Subscription Shares expected to be | |
| despatched (where applicable) by | |
+----------------------------------------+----------------------------+
Enquiries:
+-----------------------------------+-------------------------+
| Strand Hanson Limited (Nomad) | Tel: +44 (0)20 7409 |
| James Harris / Paul Cocker / Liam | 3494 |
| Buswell | |
+-----------------------------------+-------------------------+
| | |
| Keith, Bayley, Rogers & Co | Tel: +44 (0)20 3100 |
| Limited (Broker) | 8300 |
| Simon Frost / Brinsley Holman | |
+-----------------------------------+-------------------------+
| | |
| Hansard Communications | Tel: +44 (0)20 7245 |
| Justine James /John Bick | 1100 |
| | |
+-----------------------------------+-------------------------+
This information is provided by RNS
The company news service from the London Stock Exchange
END
ACQUOAVRRBAWRAR
Canisp (LSE:CN.)
Gráfica de Acción Histórica
De May 2024 a Jun 2024
Canisp (LSE:CN.)
Gráfica de Acción Histórica
De Jun 2023 a Jun 2024
