*************29 Sep 2020 19:23
************* NS bought at 5.8p and looking to top slice at 7.5p. Full article very bullish . That bottle of Ouzo was already on ice, but this morning we learned that partner of AIM-listed Ariana Resources (AAU), Proccea, is to pony up $5.75 million to Ariana for its proposed share in Salinbas to add to the $30 million we already knew about from proposed new partner Ozaltin under the new joint venture scheme currently on the table. Of course, anyone who listened to Tom Winnifrith’s interview with Ariana CEO Kerim Sener at our MineProphets online conference would have known there was more to come, but this morning’s news was a welcome surprise as to its magnitude…
Even better, we are told that 50% of the net proceeds to Ariana, after taxes and costs, is to be distributed as a special dividend. With a General Meeting circular due next month, I am hopful of a bumper payout perhaps in time for Christmas. But let’s not get completely carried away, for taxes could be quite significant and the distributable amount following a capital reorganisation (to allow dividend payments) is, at this stage, a little unclear. That is why Ariana was not specific about how much cash shareholders should expect, but I would surmise that the distribution, after costs and tax, may well be in the region of $10 million – call that £7.8 million, the final sum to be approved by shareholders. With a little over one billion shares in issue, that would work out at around 0.75p per share, although I would imagine that a few options may be cashed in before payday which would knock that figure down a shade. But the distribution will be warmly welcomed by shareholders nonetheless – and a stunning achievement, given the gold bear market we had and the consequent difficulty in raising capital.
The important point for Ariana, at this stage, was to convey the principle that the net proceeds after costs and taxes are to be split 50:50 between shareholders and the company for further investment. It seems that Chairman Michael de Villiers and CEO Kerim Sener have reached a very happy medium between rewarding the owners of the company and giving Kerim plenty of cash to work with as he searches out new prospects and develops existing ones. And with further profits to come from the Kiziltepe plant – albeit at a lower rate once Ariana has reduced its ownership to 23.5%, not to mention the new mine at Tavsan which should see production in 2022 and which has a relatively short capital repayment period, it seems to me that regular small dividends could very well become the norm with Ariana going forward.
Shares in Ariana have moved back above 6p this morning, to 6.15p – a gain of 9% – on the news. But with more gold production to come and Salinbas (which already has 1.5 million oz gold in JORC categories of Measured, Indicated and Inferred proved up) now a free carry on the back of Ozaltin’s cash, the market cap of £65 million still seems a little light in a gold bull market. Indeed, tem
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