29 Jul 2022 07:00
This announcement contains inside information
29 July 2022
Ormonde Mining plc
("Ormonde" or the "Company")
Sale of La Zarza Landholding, Drillcore and Data Assets, Spain
Ormonde is pleased to announce that it is has entered into a conditional framework agreement for the sale of its interests in the La Zarza Copper-Gold Project in Spain ("La Zarza") for a cash consideration of EUR 2.3 million (the "Sale") to La Zarza Mineria Metalica S.L.U., a subsidiary of Spanish company Tharsis Mining S.L., which controls the mining rights to La Zarza.
The Sale relates to the Company's landholding, drill core and data assets associated with La Zarza. The Company has, for some time, been advancing a disposal process in relation to La Zarza and the Board, since its reconstruction in 2021, has been working to monetise its interest in La Zarza. The Company valued its La Zarza interests at EUR 2.0 million as at 31 December 2021, with the assets represented in the financial statements as "Assets held for sale". There were no profits or losses attributable to the La Zarza assets for the year ended 31 December 2021.
Under the terms of the Sale agreement, which has been concluded at a premium to the book value of EUR 2.0 million, the Company will receive EUR 800,000 on completion of the Sale ("Completion"), with the balance to be paid in three equal payments of EUR 500,000 on the first, second and third anniversaries of Completion. Ormonde will hold security over the deferred cash payments.
The sale is conditional on approval by Ormonde shareholders at an Extraordinary General Meeting, details of which appear further below.
Brendan McMorrow, Chief Executive Officer, commented:
"This is an important milestone for Ormonde in positioning the Company to execute new opportunities which leverage our financial strength and have the prospect of generating value for shareholders in the medium term.
Ormonde prepared a feasibility study for an underground mining operation at La Zarza in 2008 which highlighted the need for a larger resource to justify development. Progress thereafter has been impeded by the Company owning the land but not the prospecting rights.
To reach a Sale agreement to release value from these assets at a premium to the book value is an excellent outcome for the Company and its shareholders. It places the Company on a stronger financial footing to acquire new projects in line with Ormonde's strategy to generate shareholder value by leveraging its balance sheet and resources."
Notice of Extraordinary General Meeting and AIM Rule 15
The Sale constitutes a disposal resulting in a fundamental change in the business of Ormonde pursuant to Rule 15 of the AIM Rules and requires the approval of the Company's shareholders ("Shareholders"). A circular, which will contain further details of the Sale (the "Circular") and a notice of Extraordinary General Meeting ("EGM"), is expected to be posted to Shareholders shortly and will also be available on the Company's website at www.ormondemining.com. The EGM is expected to be held on 28 September 2022 alongside the Company's Annual General Meeting.
The Company has received irrevocable undertakings from Thomas Anderson to vote in favour of the resolutions in relation to the Sale in respect of approximately 24.41% of the Company's issued share capital as at the date of this announcement.
Contingent on the approval of the Sale by Shareholders, the Company will become an AIM Rule 15 cash shell pursuant to the AIM Rules and a cash shell pursuant to the Euronext Growth Rules following completion of the Sale ("Completion").
The Company would therefore become a cash shell and, as such, would be required to make an acquisition or acquisitions which constitute(s) a reverse takeover on or before the date falling six months and twelve months respectively from Completion, failing which the Company's Ordinary Shares would then be suspended from trading on AIM and Euronext Growth. Further details will be included in the Circular.
Enquiries:
Ormonde Mining plc
Brian Timmons, Non-Executive Chairman
Tel: +353 (0)1 801 4184
Vigo Consulting (Investor Relations)
Ben Simons / Charlie Neish
Tel: 44 (0)20 7390 0230
Davy (Nomad, Euronext Growth Listing Sponsor and Broker)
Barry Murphy
Tel: +353 (0)1 679 6363
About Ormonde Mining plc
Ormonde is a natural resources company focussed on the evaluation and execution of new opportunities through which the Company can leverage its listing and balance sheet to generate shareholder value whilst placing a strong emphasis on cash preservation. Ormonde shares are traded on AIM in London and on the Euronext Growth market in Dublin.
For more information, visit the Company's website at www.ormondemining.com.