VGM3 Oct 2012 09:24
3 October 2012
Vatukoula Gold Mines plc
("Vatukoula" or "the Company")
Update on Strategic Investor and Placing
Vatukoula Gold Mines Plc. (AIM: VGM), the AIM listed gold producer and explorer, provides an update to the announcement made on 29 August 2012 in relation to a binding placing agreement with Shengen Xintai International Mine Industry Group Co. Ltd. ("Xintai").
Under the agreement the placing is to be completed in two tranches via the issue of a £3,195,900 convertible loan ("Loan Note") and the issue of 13,812,374 new ordinary shares in the Company at a price of 51.65 pence per share ("Placing") to raise £7,134,091. The Loan Note will automatically convert to 6,187,626 ordinary shares upon closing of the Placing, such that Xintai will invest a total of £10.3 million to acquire a total of 20 million new ordinary shares
The Placing is conditional on the approval of the state authorities in China. As a result of longer than expected timeframes in obtaining the regulatory and administrative approvals Xintai have requested an extension to the date of completion of the Placing and the Loan Note. The long-stop date of the original agreement was the 3rd October 2012. Therefore given the above Vatukoula has granted a non-exclusive extension to the Loan Note until the end of October 2012 and the Placing until the end of November 2012.
Mr Dingli Wang, CEO of Xintai commented;
"Xintai remains committed to the placing and we continue to believe that Vatukoula represents an excellent investment opportunity. We have spent considerable time at the operations in Fiji and remain confident that the right strategy and management team are in place and are capable of delivering on their stated goals."
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