TIDMCRND
RNS Number : 7950H
Central Rand Gold Limited
22 August 2016
Central Rand Gold Limited
(Incorporated as a company with limited liability under the laws
of Guernsey, Company Number 45108)
(Incorporated as an external company with limited liability
under the laws of South Africa, Registration number
2007/0192231/10)
ISIN: GG00B92NXM24
LSE share code: CRND JSE share code: CRD
("Central Rand Gold" or the "Company")
Extension of Redstone Capital Loan Notes and Warrants
Financial Update
Operational Update
Extension of Redstone Capital Loan Notes and Warrants
On 2 August 2013, the Company announced that it had entered into
an agreement to raise US$7.25 million through the issue of loan
notes (the "Loan Notes") to Redstone Capital Limited ("Redstone
Capital"). The Company also announced that it would enter into
warrant agreements (the "Warrant Agreements") with Redstone Capital
in respect of warrants over 27,091,218 ordinary shares (the
"Warrants"). The Loan Notes are convertible, and the Warrants are
exercisable, at a price equal to 8.78 pence per ordinary share.
US$3.5 million of the Loan Notes and interest outstanding totalling
US$0.18 million were due to mature (and 13,078,519 associated
Warrants were due to expire) on 19 August 2016, the third
anniversary of the date upon which they were issued. The remaining
US$3.75 million of the Loan Notes and interest outstanding
totalling US$0.19 million are due to mature (and 14,012,699
associated Warrants are due to expire) on 6 December 2016, the
third anniversary of the date upon which they were issued.
With the unanimous agreement of the Board, the Company has today
entered into an agreement to extend both the maturity of the Loan
Notes and the expiry date of the Warrants to 31 October 2016 (the
"Redstone Extension") which will enable the Company to continue to
progress the Capital Raising workstream (see details below). All
other terms of the Loan Notes and Warrants shall remain the
same.
The Redstone Extension is deemed to be a related party
transaction pursuant to AIM Rule 13. The Company's Director
independent of Redstone Capital, being Mark Austin, Non-Executive
Director, having consulted with the Company's nominated adviser,
considers that the terms of the Redstone Extension are fair and
reasonable insofar as shareholders are concerned.
Financial Update
As detailed in the Company's financial statements for the year
ended 31 December 2015, as announced on 30 June 2016, there
remained a material uncertainty in respect of the Company's ability
to continue as a going concern. As at 31 December 2015, the Company
had cash and cash equivalents of $556,000 and net current
liabilities of $13.6 million (audited).
As at 31 July 2016, the Company had cash and cash equivalents of
approximately $175,000 (unaudited), which the Directors consider to
be sufficient for only the very near term.
In addition to the Redstone Extension, the Directors have
received a proposal from an existing substantial shareholder
regarding a US$4,000,000 investment into the Company (the "Capital
Raising"). The Capital Raising is subject to necessary regulatory
approvals as well as shareholder approval.
In the interim, the Company is in discussions with this existing
substantial shareholder and another shareholder, who have
separately expressed interest in providing interim debt and/or
equity funding to the Company, including by way of a working
capital facility (the "Interim Funding").
The Board highlights that the Capital Raising is conditional on
receipt of regulatory approval and shareholder approval and
therefore no assurances can be given that both approvals will be
received. The Board also highlights that the discussions relating
to the Interim Funding are at this point in time non-binding and
subject to agreement of terms and definitive documentation between
the parties.
Joint Venture Tolling Agreement Update
Further to the announcement dated 29 July 2016, the Company
continues to receive and process gold bearing material under the
Joint Venture Tolling Agreement (the "Tolling JV"). The Tolling JV
partner is presently delivering on average 5,000 tonnes per week to
the Company's metallurgical plant. This rate of weekly delivery
will increase to the end of September, from when it is expected
that the Tolling JV parties will achieve an average processing rate
of 19,000 tonnes per month.
The Company is working closely with the Tolling JV partner
regarding the identification and sourcing of appropriate gold
bearing material for treatment through the Company's metallurgical
plant. The Company, in consultation with the Tolling JV partner,
has conducted survey, sampling and metallurgical testwork programs
(together the "Testwork Program") on the rock dump sourced by the
third party supplier (the "Ore Supplier"). Through the Testwork
Program, the Company has indicated an average head grade of 1.8g/t
with no contaminants identified. Further, the Testwork Program has
indicated approximately 6 million tonnes of gold bearing material
in the Ore Supplier's rock dump, which will be processed under the
Tolling JV.
The Company is pleased to further announce that the
refurbishment of Mill 1 is nearing completion. As previously
stated, the Company will primarily treat the gold bearing material
through Mills 1 and 3, and will utilise Mill 2 as additional
capacity as and when required.
Additional Tailings Deposit Joint Venture Opportunity
The Company is progressing discussions with the owner of a
tailings deposit located in close proximity to the Company's
metallurgical plant (the "Target Tailings Deposit"). The Target
Tailings Deposit is considered to host several million tonnes of
gold bearing material. The Company has conducted testwork on the
Target Tailings Deposit material and is expected to be in a
position to announce these testwork results, along with the final
commercial terms of the agreement relating to the Target Tailings
Deposit over the short term. The Company is contemplating a
transaction structure that will allow both the Tolling JV and the
Target Tailings Deposit to operate concurrently however the Board
highlights that no assurances can be given with respect to the
Target Tailings Deposit at this stage.
Further announcements will be made in due course.
For further information, please contact:
Central Rand Gold +27 (0) 87 310
Lola Trollip / Nathan Taylor 4400
Panmure Gordon (UK) Limited -
Nominated Adviser & Broker +44 (0) 20 7886
Adam James / James Greenwood 2500
Merchantec Capital - JSE Sponsor +27 (0) 11 325
Monique Martinez / Marcel Goncalves 6363
Mark Austin, Non-Executive Director of the Company with over
thirty five years' experience in the exploration and mining
industry, has read and approved the geological disclosure in this
regulatory announcement. Mr Austin holds a B.Sc. Hons. in Geology,
is a registered Natural Scientist ('SACNASP') and a Fellow of the
Geological Society of South Africa and is currently serving on the
Steering Committees of the South African Code for the Reporting of
Exploration Results, Mineral Resources And Mineral Reserves
('SAMREC') and the South African Code for the Reporting of Mineral
Asset Valuation ('SAMVAL').
22 August 2016
The information communicated in this announcement is inside
information for the purposes of Article 7 of Market Abuse
Regulation 596/2014 ("MAR").
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCAKBDDKBKDPFB
(END) Dow Jones Newswires
August 22, 2016 06:20 ET (10:20 GMT)
Central Rand (LSE:CRND)
Historical Stock Chart
From Jun 2024 to Jul 2024
Central Rand (LSE:CRND)
Historical Stock Chart
From Jul 2023 to Jul 2024
