Armadale Capital Regulatory News (ACP)

18 Mar 2015 11:15

Armadale Capital Plc / Index: AIM / Epic: ACP / Sector: Investment Company

18 March 2015

Armadale Capital Plc (“Armadale” or the “Company”)

Placing to raise £270,000

Armadale, the AIM quoted investment company focused on natural resource projects in Africa, is pleased to announce a conditional placing (“Placing”) of 966,666,663 new ordinary shares of 0.01 pence each in the capital of the Company (“Ordinary Shares”) (the “Placing Shares”) at a price of 0.03p pence per share (the “Placing Price”) to raise net proceeds of £270,000 with institutional and other investors.

In addition, the Company has issued 99,999,999 new Ordinary Shares to certain advisers (the “Adviser Shares”) at the Placing Price to settle advisory fees.

Armadale also announces by mutual agreement that there will be no further drawdowns from the Company’s flexible funding option with Bergen Global Opportunity Fund, LP (‘Bergen’), an institutional investment fund (see announcement of 16 October 2014).

The proceeds of the Placing will be used for the continued development of the Mpokoto Gold Project in the Katanga Province of the Democratic Republic of the Congo (“Mpokoto” or the “Project”), which has a resource of 678,100oz Au. It will also provide general working capital for the Company as it continues discussions with potential funding partners to secure the $20 million of capital required to commence construction of the Project ahead of commencing commercial gold production in H1 2016.

Armadale recently announced further positive metallurgical testwork on a number of samples of oxide ore from Mpokoto which confirmed gold recovery of 84-92% from the ore. The Company is now finalising a definitive feasibility study on the Project which advances the work already undertaken as part of the Expanded Scoping Study.

Peter Marks, Chairman of Armadale, said:

“We are pleased with the continued support of the capital markets and the shareholders of Armadale as we continue to advance the Mpokoto Gold Project. These funds will allow us to progress the definitive feasibility study in the near term, which is targeted for completion in Q2 2015, and will provide us with a stable footing from which to continue our negotiations with regard to the financing required to commence construction of the Project. We look forward to advancing Mpokoto into production in H1 2016 as a low capex gold project, with a post-tax NPV of US$55.3 million and steady state production of 25,600oz over a nine year life of mine.”

Admission

The Placing is subject, inter alia, to admission of the Placing Shares to trading on AIM (“Admission”), which is expected to occur at 8.00 a.m. on Friday 20 March 2015. Application has been made to the London Stock Exchange for all of the Placing Shares and Adviser Shares to be admitted to trading on AIM. The Placing Shares and Adviser Shares will, when issued, rank pari passu in all respects with the Company's existing Ordinary Shares.

Directors’ Shareholdings and Related Party Transactions

Justin Lewis and Peter Marks, the directors of the Company (the “Directors”), will be subscribing for Placing Shares in the Placing. The interests of the Directors following the Placing will be as follows:

The subscription for Placing Shares by the Directors are considered to be related party transactions pursuant to the AIM Rules for Companies. Given that both of the Directors are participating in the Placing, there are no independent directors of the Company. The Company’s nominated adviser, finnCap, considers that the terms of the subscription for Placing Shares by the Directors are fair and reasonable insofar as the Company’s shareholders are concerned.

Total Voting Rights

Following Admission, the Company will have 5,404,461,330 Ordinary Shares in issue. The Company has no shares in treasury, therefore the figure of 5,404,461,330 should be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change of their interest in, the share capital of the Company under the FCA's Disclosure and Transparency Rules.

**ENDS**

Enquiries:

Notes

Armadale Capital Plc is focused on investing in and developing a portfolio of investments, targeting the natural resources sector in Africa. The Company, led by a team with operational experience and a strong track record in Africa, has a strategy of identifying high growth potential businesses where it can take an active role in their advancement.

Armadale owns 80% of the Mpokoto Gold Project in the Democratic Republic of Congo. Armadale is focused on proving up the resource potential of Mpokoto with a view to commencing commercial gold production.

Armadale also holds approximately a 30% interest in Mine Restoration Investments Ltd, a South African listed company, which aims to develop profitable operations within the South African mining industry through its coal briquetting operation in KwaZulu Natal.

In addition, Armadale has a small portfolio of listed investments which are focused on gold and copper production and exploration. The Directors continue to maintain an active acquisition strategy and will review investment opportunities that they believe have the potential to be accretive in terms of shareholder value.

Copyright Business Wire 2015