9 Nov 2010 09:19
9 November 2010
Polo Resources Limited("Polo" or "the Company")
Option Agreement for acquisition of majority interest in MinFer Holdings Limited
Polo Resources Limited (AIM and TSX: POL) announces the signing of an Option Deed under which Polo is granted an option (the "Option") to acquire approximately 70 per cent. of the issued share capital ("Option Shares") of MinFer Holdings Limited ("MinFer").
MinFer is a company incorporated in the British Virgin Islands which (together with its wholly-owned subsidiary Minfer Do Brazil Mineracao Ltda ("MinFer Subsidiary") is engaged in the acquisition of, and exploration of, iron ore projects in Brazil. The MinFer Subsidiary is the holder of options to acquire a number of interests in iron ore projects in Brazil.
The Option has been granted by MinFer and shareholders representing 70 per cent. of the issued shares of MinFer and is granted in consideration of Polo funding an agreed work program of MinFer/MinFer Subsidiary (the "Work Program") up to a maximum sum of US$1,000,000 (one million US dollars) which sum is not refundable to Polo if the Option is not exercised.
The Company will endeavour to reach agreement with the outstanding MinFer shareholders not party to the Option Deed prior to commencing the Work Program.
Unless otherwise agreed in writing by the parties to the Option Deed and the MinFer shareholders, the Option is exercisable within 90 days of (and including) the date of the Option Deed.
If exercised, the consideration payable by Polo to the MinFer shareholders to acquire all of the Option Shares is up to US$20,000,000 (twenty million US dollars) based on the Company acquiring 100 per cent. of the issued shares of MinFer, which shall be satisfied through the issue to the MinFer shareholders of ordinary shares ("Consideration Shares") in Polo. These Consideration Shares will be subject to a lock in for 12 months from their date of issue.
Regent Mercantile Holdings Limited, which is interested in 23.1% of the issued shares of Minfer, is owned by trustees of a discretionary trust under which Stephen Dattels, Executive Co-Chairman of the Company, is the principal beneficiary.
As a result the decision to exercise the Option (which will be taken having undertaken some or all of the Work Program) will be classed as a related party transaction under AIM Rule 13. Accordingly, prior to the exercise of the Option the directors (excluding Stephen Dattels) having consulted with Polo's Nominated Adviser, Canaccord Genuity Limited, must consider the terms of the Option to be fair and reasonable insofar as Polo's shareholders are concerned.
Neil Herbert, Executive Co-Chairman, said:
"We are very pleased to announce the signing of the option deed in relation to MinFer Holdings Limited. MinFer has a number of options over exciting iron ore projects in Brazil and, subject to due diligence (through the funding of the agreed work program) Polo has the exclusive right to exercise the option and acquire MinFer's interest in the various projects."
Contacts:
Polo Resources Limited
Neil Herbert, Executive Co-Chairman
+ 27 82 404 36 37
Canaccord Genuity Limited
Ryan Gaffney / Bhavesh Patel
+ 44 (0) 20 7050 6500
Toronto
James McVicar
Heenan Blaikie LLP
+1 416 643 6903
Blythe Weigh Communications
Tim Blythe
Ana Ribeiro
Matthew Neal
+44 (0) 20 7 138 3204
About the Company
Polo is an emerging energy company focused on acquiring and developing advanced stage coal and uranium properties. For complete details on Polo Resources Limited, management encourages investors and interested parties to view its public documents filed on AIM Market at www.poloresources.com.
CAUTIONARY STATEMENT
The AIM Market of London Stock Exchange plc does not accept responsibility for the adequacy or accuracy of this release. No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein. All statements, other than statements of historical fact, in this news release are forward-looking statements that involve various risks and uncertainties, including, without limitation, statements regarding potential values, the future plans and objectives of Polo Resources Limited. There can be no assurance that such statements will prove to be accurate, achievable or recognizable in the near term.
Actual results and future events could differ materially from those anticipated in such statements. These and all subsequent written and oral forward-looking statements are based on the estimates and opinions of management on the dates they are made and are expressly qualified in their entirety by this notice. Polo Resources Limited assumes no obligation to update forward-looking statements should circumstances or management's estimates or opinions change.