TIDMABM TIDMKAT
RNS Number : 0193T
African Battery Metals PLC
15 March 2019
15 March 2019
African Battery Metals plc ("ABM" or the "Company")
Investment and Option Agreement with Katoro Gold plc
African Battery Metals plc (LON:ABM) the AIM listed battery
metal exploration and development company is pleased to announce
the it has acquired an interest in Katoro Gold plc
(LON:KAT)("Katoro") and entered into an option agreement (the
"Option") with Katoro to acquire an interest in the Haneti Nickel
Project ("Haneti") in Tanzania (altogether the "Agreement").
Under the Agreement ABM will be able to acquire up to 10 million
new ordinary shares of 1.0 pence each in the capital of Katoro
("Ordinary Shares"), together with up to 10 million warrants over
Ordinary Shares, and an option to acquire, subject to the
completion of due diligence by ABM, up to a 35% interest in
Katoro's 100% owned Haneti Nickel Project ("Haneti") in Tanzania
(the "Option") for a total consideration of up to GBP125,000.
Highlights:
-- Katoro is an AIM listed exploration and development company
with gold and nickel interests in Tanzania;
-- Katoro holds a 100% interest in the Haneti project which
comprises tenements covering an area of circa 5,000 sq. km
(prospecting licences, offers and applications) prospective for
nickel, platinum-group-elements, cobalt, copper, gold and
lithium;
-- Katoro also holds a 100% interest in the Imweru and Lubando
gold projects in Tanzania which in total host a JORC compliant gold
resource (inferred and indicated) of 754,980 ounces of gold;
-- For a consideration of GBP25,000, ABM will acquire 2,500,000
new Ordinary Shares (the "Tranche 1 Shares"), equating to an issue
price of 1.0 pence per share;
-- ABM will also be granted 2,500,000 warrants to subscribe for
2,500,000 new Ordinary Shares at a price of 1.25 pence per share
with a three year expiry term from today's date;
-- Under the Agreement, ABM has been granted the Option, for a
period of 60 days in which to undertake due diligence on Katoro and
its projects, in particular Haneti;
-- If ABM exercises the Option, ABM will invest a further
GBP75,000 to acquire an additional 7,500,000 new Ordinary Shares at
a price of 1.0 pence per share (the "Tranche 2 Shares");
-- On exercise of the Option, ABM will also be granted a further
7,500,000 warrants to subscribe for 7,500,000 new Ordinary Shares
at a price of 1.25 pence per share with a three year expiry term
from the date of the exercise of the Option;
-- On exercise of the Option, ABM will also acquire a 25%
interest in the Company's wholly owned subsidiary, Kibo Nickel
Limited ("Kibo Nickel"), which, through its wholly owned
subsidiary, Eagle Exploration Limited ("Eagle"), holds a 100%
interest in Haneti. Following the Option exercise, Katoro will
retain a 75% interest in Kibo Nickel;
-- Following the Option exercise, ABM will be required to fund
its 25% share of Haneti costs, or will dilute in accordance with
standard industry fund or dilute provisions;
-- In the event the Option is exercised, ABM will have the
right, for 12 months after the Option exercise date, to acquire a
further 10% interest in Kibo Nickel for a further payment to Katoro
of GBP25,000 in cash.
Paul Johnson, Executive Director of African Battery Metals
commented: "I am delighted to announce the acquisition of an
interest in Katoro Gold plc and the Option agreement enabling us to
increase our holding in Katoro and also secure a strategic stake in
the Haneti Nickel Project.
The Agreement announced today complements our existing interests
and provides a degree of diversification whilst remaining focused
on Africa and battery metal projects.
Alongside our existing copper and cobalt interests, the addition
of nickel into our portfolio exposes our shareholders to another
strategically significant metal where we believe the forward
supply/demand dynamics are looking highly attractive.
We are looking to work with Katoro on an accelerated exploration
programme at Haneti to build on the knowledge that Katoro, and
previous owner Kibo Mining plc, gathered. This includes data
demonstrating 13.59% nickel in sampling of outcrops.
We look forward to reporting back on developments in respect of
this strategic transaction in the near future."
Note: within its unaudited half year results to 30 June 2018
Katoro Gold plc reported a loss for the half year of GBP152,279 and
a comprehensive income (after exchange differences on translating
of foreign operations) of GBP10,670 and net assets at 30 June 2018
of GBP254,569.
For the year ended 31 December 2017, Kibo Nickel reported net
liabilities of EUR11,620, nil revenue and a loss for the year of
EUR3,300. For the year ended 31 December 2017, Eagle reported net
liabilities of US$891,968, nil revenue and a loss for the year of
US$33,989. Kibo Nickel does not consolidate the results of Eagle
and Eagle's only liability, is an inter-company loan of US$957,621
which was transferred to Katoro on completion of the acquisition in
November 2018.
Further information on the Agreement
Katoro is required to allocate the monies received pursuant to
the issue of the Tranche 1 Shares, the potential issue of the
Tranche 2 Shares and the potential receipt of a further GBP25,000
from ABM to the maintenance, exploration and development of
Haneti.
In the event the Option is exercised, Katoro and ABM will
establish within one month a written Joint Venture Agreement and
associated Shareholder Agreement in respect of Kibo Nickel, Eagle
and Haneti.
Save for certain circumstances, the warrants issued pursuant to
the Agreement may, until 1 July 2019, only be exercised by ABM if
such exercise does not dilute Kibo Energy plc ("Kibo"), Katoro's
major shareholder, to less than 50.5% of the issued share capital
of Katoro at that time.
Background to the Haneti Nickel Project
Extract from the latest Katoro Gold plc market announcement in
respect of the Haneti Nickel Project dated 30 January 2019.
Link to announcement:
https://polaris.brighterir.com/public/katoro_gold/news/rns/story/w1m5y3w
The 5,000 sq. km polymetallic Haneti Nickel Project in Tanzania
is a highly prospective, high-grade nickel sulphide asset. Previous
work, totalling approximately US$1.5 million, has identified grades
of up to 13.59% nickel with additional gold, cobalt, platinum
credits and some significant lithium anomalies. Additionally,
independent work, undertaken by Western Geophysics Pty, underlines
the potential of HNP to host a substantial nickel sulphide
deposit.
The Company acquired HNP in November 2018 and immediately
commenced a review and analysis of all historic work completed on
the Project. Based on the review of historic exploration work on
the Project, the Company believes that it could host a chonolith
type nickel sulphide deposit and that Mihanza Hill, one of several
high priority exploration targets within HNP, is the most
prospective target identified to date and this will be the initial
focus for the Company.
The main objective of the 2019 exploration work programme will
be to ascertain the existence of disseminated (or massive) sulphide
mineralisation at the identified high priority exploration targets,
including Mihanaza Hill. Using a variety of exploration techniques,
the programme will seek to define a future drilling programme. Work
has already commenced in this regard, with the Company having
completed a soil sampling programme of 1,300 samples which are now
ready to be submitted for laboratory analysis.
The information contained within this announcement is considered
to be inside information prior to its release, as defined in
Article 7 of the Market Abuse Regulation No.596/2014 and is
disclosed in accordance with the Company's obligations under
Article 17 of those Regulations.
For further information please visit https://www.abmplc.com/ or
contact:
African Battery Metals plc
Paul Johnson (Executive Director) +44 (0) 7766 465 617
SP Angel Corporate Finance (Nomad and Joint Broker)
Ewan Leggat +44 (0) 20 3470 0470
SI Capital Limited (Joint Broker)
Nick Emerson +44 (0) 1483 413 500
Notes to Editors:
ABM is an AIM listed, Africa focused, resource company exploring
for the key metals used in next generation batteries that fuel the
new electric vehicle revolution. The Board and team of advisors,
who have proven expertise in African exploration, mining and
project generation, have identified an opportunity to utilise the
Company's position to become a leader in the London market for
investors to gain exposure to the battery metal commodity suite,
particularly cobalt, lithium, copper and nickel.
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
AGRLIFVAVTIELIA
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