Scotgold Resources Ltd Conditional Sale of French Subsidiary (8070H)
March 15 2018 - 2:10AM
UK Regulatory
TIDMSGZ
RNS Number : 8070H
Scotgold Resources Ltd
15 March 2018
15 March 2018
Scotgold Resources Limited
("the Company" or "Scotgold")
Conditional Sale of French Subsidiary
The directors of Scotgold are pleased to announce that the
Company has today sold all of its shares in its wholly owned
subsidiary SGZ France SAS (the "Subsidiary") which holds the French
exploration licence, Vendrennes.
The sale of the Subsidiary is conditional upon the parties
receiving an acknowledgement from the Minerals Resources Office of
the Ministry for Economy and Finance of France ("relevant French
Government Office"), that the transfer of shares is acceptable. The
relevant French government office will require satisfaction that
the purchaser has the financial capacity to meet the licence
expenditure commitments. This acknowledgement must be received
within three months from the date of the share sale agreement, or
such longer period as may be agreed between the parties.
In addition to the Vendrennes license, the Subsidiary has
current applications pending for the additional exploration
licences of Penlan and Olivet (altogether the "Licences"). If the
Penlan Licence is granted to the Subsidiary, the purchaser must
immediately offer it to the Company for EUR1.00 but is under no
obligation to accept such offer.
The consideration for the sale includes settlement cash proceeds
of EUR100,000 and further deferred cash payments of up to
EUR900,000 conditional upon completion of certain milestones by the
purchaser, related to the development of any of the Licences.
Further details are provided below.
Richard Gray, CEO of Scotgold, said:
"We are delighted to have sold our French Subsidiary on the
terms offered. We strongly believe in the potential value of the
assets, however, given our current focus on the Cononish project
with its exciting developments and the recently announced planning
permission, we are pleased to have attracted a purchaser who can
progress the French Licences, making the sale mutually beneficial.
We retain the opportunity to acquire the Penlan licence if it
becomes available, and moreover the Company will benefit from the
commercial exploitation of any of the Licences in the future and we
wish the purchaser every success in their endeavours."
Further Details
The following information is provided pursuant to Schedule Four
of the AIM Rules for Companies.
a) The name of the purchaser is Ikigai Limited. The Company has,
pursuant to a share sale agreement, sold its holding of 100% of all
of the shares in the capital of its Subsidiary, being 200,000 fully
paid shares of EUR1.00 each ("SAA"). The SAA provides the
opportunity, but not the obligation, for the Company to purchase
from the Subsidiary, the Penlan licence in the event that it should
be subsequently granted to the Subsidiary.
b) The only asset held by the Subsidiary is the exploration
licence of Vendrennes (Permit Exclusif de Recherche). In addition,
the Subsidiary has outstanding applications for each of the
exploration licences of Penlan and Olivet.
c) All expenditure related to the Vendrennes licence has been
expensed as incurred and accordingly, the licence is carried at
EURNil value on the balance sheet of the Subsidiary.
d) The consideration comprises EUR30,000 receivable upon receipt
by the purchaser of an acknowledgement or approval from the
relevant Government Department, being the Minerals Resources Office
of the Ministry for Economy and Finance and/or Ministère de
l'Ecologie, du Logement et de la Nature of France, that the shares
in the Subsidiary may be transferred.
A further EUR70,000 is receivable on the date which is nine (9)
months after the date of signing the SAA, being 14 December
2018.
A further EUR200,000 is receivable upon completion by the
purchaser of a bankable feasibility study in relation to any of the
Licences.
A final amount of EUR700,000 is receivable upon the commencement
of profitable production of minerals from any of the Licences.
e) The above consideration proceeds will be applied by the
Company, firstly to general working capital and secondly to the
proposed exploration programmes of the Company.
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have
been deemed inside information for the purposes of Article 7 of
Regulation (EU) No 596/2014 until the release of this
announcement.
For further information -
Scotgold Resources Limited Tel: +44 (0)1838 400 306
Richard Gray
SP Angel Corporate Finance Tel +44 (0) 20 3470 0470
LLP
Nomad and Joint Broker
Ewan Leggat / Charlie
Bouverat
Smaller Company Capital Tel: +44 (0)20 3651 2911
Ltd
Joint Broker
Rupert Williams
Capital Markets Consultants Tel: +44(0)7703 167 065
Financial PR
Simon Rothschild
This information is provided by RNS
The company news service from the London Stock Exchange
END
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