Kavango Resources Regulatory News (KAV)

PRESS RELEASE

10 November 2020

KAVANGO RESOURCES PLC

("Kavango" or "the Company")

Proposed placing to raise £2,000,000

Kavango Resources plc (LSE:KAV), the exploration company targeting the discovery of world-class mineral deposits in Botswana, is pleased to announce that it has conditionally raised £2,000,000 before expenses by the issue of 72,727,273 New Ordinary Shares in the capital of the Company ("New Ordinary Shares") at a price per share of 2.75 pence.

Placing

The 72,727,273 New Ordinary Shares have been conditionally placed by First Equity Limited ("First Equity"), on behalf of the Company with institutional and other investors, including high net worth and retail investors (the "Placing").

Each New Ordinary Share has, on a one-for-one basis, a warrant attached exercisable at 4.25p for a term of 30 months from the date of issue, which is subject to an acceleration clause whereby should the Company's volume weighted average share price exceed 15p for more than 10 consecutive trading days, the Company may at any time write to the warrant holders providing 10 working days' notice of accelerated exercise, with 10 workings day thereafter for payment.

Further details of the Placing, including the expected date of admission of the New Ordinary Shares ("Admission"), will be set out in a prospectus ("Prospectus") to be published in electronic form and available on the Company's website.

Michael Foster, Chief Executive Officer of Kavango, commented:

"We are very pleased to have received such strong backing from investors, as we now enter an exciting phase of Kavango's development. The Company sought to raise a maximum of £2 million and I am happy to report that the placement was over-subscribed.

We are now well funded to pursue our ambitious exploration plans and unlock what we believe is the Kalahari Suture Zone's ("KSZ") considerable potential. We have taken great strides over recent years to validate our overall exploration hypothesis that the KSZ is host to one or more large Copper-Nickel-PGM deposits.

Over recent weeks we have continued further analysis of the extensive geological data we have compiled and will announce shortly our highest priority target areas."

Use of funds

The Placing is to raise funds to meet exploration costs across the Company's portfolio of project in Botswana, JV commitments and general working capital as set out below.

The Net Proceeds of £1.9m raised through the Placing, being the gross proceeds of £2.0m, less transaction costs, will primarily be used to carry out proposed exploration work, provide working capital to the Group and to meet its regulatory and administrative commitments.

Kavango's primary proposed work programme will be focused on the KSZ Project. Here the Company plans to complete "large loop" electromagnetic surveys to identify high-priority drill targets for a major drill campaign to commence in 2021.

The Company also plans to commit working capital to fund further exploration across its interests in the Kalahari Copper Belt ("KCB") and at Ditau. Two of the KCB prospecting licenses and the two Ditau prospecting licenses are subject to a Strategic Joint Venture with Power Metal Resources Plc. The other two KCB prospecting licenses are subject to a farm-in agreement with LVR GeoExplorers (Pty) Ltd.

Details of the Placing

The New Ordinary Shares will represent approximately 27 per cent. of the Enlarged Share Capital. The New Ordinary Shares will rank pari passu in all respects with Existing Ordinary Shares including all rights to dividends and other distributions declared, made or paid following Admission and will be issued as fully paid. Application will be made for the New Ordinary Shares to be admitted to the Standard Segment of the Official List and to the London Stock Exchange.

Warrants will also be issued for each New Ordinary Share subscribed for at an exercise price of 4.25p for a period of thirty months from issue ("Placing Warrants"). The Placing Warrants term is subject to an accelerator clause whereby should the 10-day Ordinary Share VWAP be above 15p, the Company can call for any unexercised Placing Warrants to be exercised within no later than 4 weeks of the date of an RNS stating the accelerator clause is being used to shorten the term of the Placing Warrants and all remaining Placing Warrants will need to be exercised or otherwise forfeited.

Appointment of Joint Broker

The Company has appointed First Equity as joint broker with immediate effect and First Equity will be issued with 6,140,000 warrants ("Broker Warrants"), with the same terms as set out above for the Warrants issued as part of the Placing. 

Total Voting Rights 

Following the issue of the Placing Shares, the Company will have 265,682,982 Ordinary Shares in issue.

Prospectus

The Company is in the final stages of seeking approval from the Financial Conduct Authority for its prospectus to be issued in connection with the Placing. 

Further information in respect of the Company and its business interests is provided on the Company's website at www.kavangoresources.com and on Twitter at #KAV.

For further information please contact:

Kavango Resources plc

Michael Foster mfoster@kavangoresources.com

First Equity (Joint Broker)

Jason Robertson +44 207 374 2212

SI Capital Limited (Joint Broker)

Nick Emerson +44 1483 413 500

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