Blencowe Resou. Regulatory News (BRES)

28 October 2019

Blencowe Resources Plc

 ("Blencowe" or the "Company")

 Signing of Share Purchase Agreement for the Orom Graphite Project

Highlights

·; Acquisition of the Orom Graphite Project in Uganda

·; Consideration of £2m to be satisfied by the issue of 33,333,333 new shares at an implied price of 6p

Blencowe Resources Plc (LSE:BRES), the natural resources sector focused special purpose acquisition company, is pleased to announce that it has signed a Share Purchase Agreement with Consolidated Africa Limited ("CRA") and New Energy Minerals Africa Pty Ltd ("New Energy") for the proposed acquisition by the Company of 100% of the share capital of Consolidated African Resources (Uganda) Ltd ("CARU"), a subsidiary of CRA, by way of a reverse takeover ("Transaction"). CRA and New Energy have given their binding consent to the acquisition. 

CARU is a Ugandan registered company which is the owner of the Orom Graphite Project in northern Uganda (the "Orom Graphite Project").

Blencowe will, subject to a successful placing, acquire the entire share capital of CARU with the total aggregate consideration payable by the Company being £2,000,000 (two million pounds), to be satisfied in full by the issue of 33,333,333 new ordinary shares of the Company at an implied price of £0.06 per share, of which £500,000 will be payable to New Energy as consideration for the assignment of the option to acquire CARU which was granted to it by CRA and £1,500,000 will be payable to CRA as the acquisition price for CARU. In addition, there is cash consideration payable to CRA of AUD$50,000 which will be payable whether completion occurs or not. Completion of the Transaction will be conditional on Blencowe raising working capital for the enlarged group to further develop the Orom Graphite Project by way of a placing of new ordinary shares in the Company. CRA has also granted the Company an option to acquire additional licences that it holds in Uganda which may be exercised at any time in the 12-month period following completion of the Transaction.

The Transaction remains subject to completion of the fundraising and re-listing of the enlarged group on the London Stock Exchange and to the approval of CRA entering into the Transaction by the National Stock Exchange of Australia . Accordingly, there is no certainty that it will be completed. If the Transaction is completed, it will constitute a reverse takeover under the Listing Rules and will be subject to approval by shareholders of the Company at a general meeting. As the Company is unable to provide full disclosure under Rule 5.6.15 of the Listing Rules, the Company has requested the FCA to keep the suspension of its listing of its ordinary shares on the Standard Segment of the Official List, and as traded on the Main Market of London Stock Exchange pending publication of a prospectus in relation to the Transaction and the General Meeting, setting out details of the proposed Transaction and the fundraising (or in the alternative the Company announces that it has elected not to proceed with the Transaction). Suspension of trading will continue until this time.

 Further announcements will be made in due course as the Transaction progresses.

Cameron Pearce, Non-Executive Chairman commented:

 "Blencowe was formed for the purposes of acquiring a natural resources asset and the Board is fortunate, having reviewed several projects, to now be in a position to have reached an investment decision. We are pursuing a metal that has strong future for the next 20 years given that graphite is the largest component of the lithium battery. We believe that the Orom Graphite Project can be globally significant due the high-quality product and scale of the target resource. The graphite is characterised by large and jumbo flake size with both high grade and purity that is in short supply and demands a premium price. We look forward to publishing a prospectus in the near future outlining what we believe is a very exciting transaction highlighted by the recent granting by the Ugandan Government of a 21 year mining licence."

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