19 Oct 2009 08:05
| 19 October 2009 | AIM: GMA |
GMA Resources Plc
("GMA" or "the Company")
GMA raises £1.9 million
GMA announces that it has entered into a subscription agreement ("the Agreement") with a wholly owned subsidiary of ASCOM Precious Metals Mining S.A.E., Valencia Services Holding Limited ("APM"), in respect of the subscription of 42,636,624 new ordinary shares of £0.01 each ("Subscription Shares") at 4.5 pence per share.
The Subscription Shares will be issued in four separate tranches and will represent, in aggregate, approximately 9 per cent of the enlarged issued share capital of the Company. The first tranche of the Subscription Shares will be issued on or before 23 October 2009, raising approximately £480,000 for the Company.
The Subscription Shares will be issued in the following tranches and on the following dates, unless, in respect of the second, third and fourth subscription dates only, APM elects to subscribe on an earlier date:
| Subscription Date | Number of Subscription Shares | Subscription proceeds |
| 19 October 2009 | 10,659,156 | £479,662.02 |
| 15 December 2009 | 10,659,156 | £479,662.02 |
| 18 January 2010 | 10,659,156 | £479,662.02 |
| 22 February 2010 | 10,659,156 | £479,662.02 |
The Agreement contains lock-in provisions, under which APM has agreed not to dispose of the Subscription Shares comprised in each tranche for a period of six months after the date of admission to trading on AIM ("Admission") of the relevant tranche of Subscription Shares, without the prior written consent of the Company. The Agreement gives APM the right to appoint a director to the board of the Company following Admission of the fourth tranche of Subscription Shares and also a first right of refusal on any future equity subscriptions in the Company until 31 August 2010. Following Admission of the fourth tranche of Subscription Shares, the Company will have exhausted its existing authorities to issue equity securities for cash and the issue of any further equity securities for cash, other than in accordance with the statutory pre-emption rights, will require prior shareholder approval.
The proceeds of the Subscription will be used for general working capital purposes, to expand on the Company's existing exploration activities and to do preliminary work on the five year plan for expansion.
Application will be made shortly for Admission of the first tranche of the Subscription Shares, comprising 10,659,156 ordinary shares, which is expected to take place on 23 October 2009. Following Admission of this first tranche of Subscription Shares, there will be a total of 437,025,426 ordinary shares in issue.
Douglas Perkins, CEO of GMA, commented:
"We are pleased to have been able to conclude this funding and to have attracted an important strategic investor such as APM. The subscription secures working capital for the short term and we can now concentrate on building up to steady state production levels at the Company's subsidiary ENOR Spa and progressing GMA's planned exploration and development activity, as approved recently by both shareholders of ENOR Spa for the next five years."
Enquiries:
| GMA Resources Plc | Douglas Perkins | +1 514 806 6788 |
| Merchant John East Securities Limited | Bidhi Bhoma | +44 (0) 20 7628 2200 |
Notes to Editors:
GMA owns a controlling 52 per cent. stake in ENOR spa ("ENOR"), the Algerian based operating company for the Tirek-Amesmessa project, with the remainder owned by Sonatrach, the Algerian state-owned oil and gas company.
ENOR holds the exploitation authorisation to the Tirek-Amesmessa property, an area of some 1,417 km2, located approximately 450km south west of the city, Tamanrasset, in southern Algeria. Amesmessa is an open pit heap leach gold mine located in the extreme south of the permit area. The Tirek gold mine is located centrally in the northern third of the exploration permit area, some 60 km north of Amesmessa. Research to date suggests that the Zita Zone, which lies between Tirek and Amesmessa, offers considerable potential for the development of additional prospects amenable to open-pit mining. GMA plans to quickly expand upon resources outside of the major 80km Tirek-Amesmessa fault north/south of the concession.
GMA's shares are traded on the AIM market of the London Stock Exchange (AIM: GMA).
For further information on the Company, please visit: www.gmaresources.co.uk