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(Alliance News) - Bluebird Merchant Ventures Ltd on Wednesday noted that Catalyse Capital Ltd is buying Southern Gold Ltd's shares in Bluebird.
Bluebird Merchant Ventures is a South Korea-focused gold company primarily focused on bringing historic mines back into production.
Bluebird describes Catalyse as a "long running and supportive shareholder" who recognises the "true potential of the company's South Korean and Filipino gold projects".
Bluebird Merchant shares jumped 22% to 0.76 pence each on Wednesday morning in London.
The company said Catalyse is buying Southern Gold's 122.5 million Bluebird shares, or around 18% of issued Bluebird shares. 22.5 million of those shares will be bought at at 0.55 pence per share with settlement due on Monday. The price is an 11% discount to Bluebird's share price of 0.62p at the close on Tuesday. The remaining 100 million shares will be purchased by Catalyse in four tranches of 25 million shares each, to be settled monthly from September to December.
"Each of the four tranches will be priced at 75% of each month's volume-weighted average price for Bluebird's shares with a floor price of 0.4 pence," Bluebird said.
Bluebird Chief Executive Officer Colin Patterson said: "Southern Gold's selling, caused by their strategic shift away from gold and into critical metals, has undoubtedly affected our share price, and to ameliorate the Southern Gold situation is good news. The board and investors can now focus on the positives of the business, the securing of the Mountain temporary use permits for both the Gubong and Kochang historic gold mines and the progress being made by our Philippine joint venture partner at Batangas where it is finalising the eagerly awaited drill plan, a campaign which we believe will further quantify the project's excellent potential."
By Tom Budszus, Alliance News reporter
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