SRX.L Regulatory News (SRX)

19 Oct 2005 07:00

Titanium Resources Group Ltd19 October 2005 Titanium Resources Group Limited Placing of new shares to raise £10.0 million ($17.5 million) Titanium Resources Group Ltd ("TRG" or the "Group") announces that 20,000,000new common shares (of no par value) in the capital of the Group (the "PlacingShares") have been placed with institutional investors at a price of 50p pershare to raise £10.0 million ($17.5 million) before expenses. The Placing Sharesrepresent approximately 10.7 per cent. of the existing issued share capital ofthe Group. Application will be made to the London Stock Exchange for the Placing Shares tobe admitted to trading on the Alternative Investment Market of the London StockExchange ("AIM"). The Placing Shares will rank in full for all dividends orother distributions made, paid or declared hereafter and pari passu in all otherrespects with the existing common shares. The Placing is conditional on, interalia, the admission of the Placing Shares to AIM becoming effective, which isexpected to occur on Tuesday, 25 October 2005, when dealings in the PlacingShares are expected to commence. TRG owns two mining operations in the Republic of Sierra Leone - the SierraRutile Project and the SML Bauxite Project. Both mines operated for over 15years until operations were suspended in 1995; operations are expected torestart in the first quarter of 2006. The Sierra Rutile Project will employconventional dredging and processing methods to produce mineral sands andpreviously produced approximately 30 per cent of the world's annual supply ofnatural rutile, a high titanium-bearing feedstock employed in the manufacture oftitanium dioxide. The Group has signed sales contracts for more than half of itsanticipated annual production of rutile and negotiations continue with a numberof other buyers for the remaining production. The SML Bauxite Project will produce premium grade metallurgical bauxite, theprimary feedstock used in the production of aluminium. The Group has enteredinto long-term offtake agreements with Alcoa World Alumina LLC and Glencore AGfor the project's estimated annual bauxite production. TRG was admitted to AIM in August 2005 and raised $74 million (£41 million) at47p per share. In view of the strong demand for high-quality rutile, TRG has been investigatingoptions for expanding rutile production. The net proceeds of the Placing will beused for general corporate purposes including conversion of additional resourcesto reserves through infill drilling, as well as funding a feasibility study intothe viability of expanding rutile production through the reprocessing oftailings or dry mining of outlying ore bodies which do not fall within thecurrent dredge paths. Following completion of the Placing, the holding of Jean-Raymond Boulle isexpected to fall from 48.2 per cent. to approximately 43.6 per cent. of theGroup's issued share capital. TRG also announces the appointment of Arbuthnot Securities Ltd as Broker withimmediate effect. Arbuthnot is acting as broker in respect of the Placing. Commenting on the Placing Walter Kansteiner, Chairman of TRG, said: "The funds raised through the Placing will enable us to take advantage of theopportunities to expand our rutile reserve base which we identified at the timeof our Admission to AIM. We also remain on track to re-start production at theSierra Rutile Project and the SML Bauxite Project in the first quarter of 2006." "We are committed to delivering on our strategy to re-start and expand ouroperations in Sierra Leone for the benefit of shareholders and believe that thecontinued support from institutional investors reflects the quality of ourassets and the positive outlook for titanium feedstock markets going forward." 19 October 2005 PRESS ENQUIRIES Titanium Resources Group 020 7321 0000Walter Kansteiner, Chairman Arbuthnot 020 7012 2000James Steel Aura Financial 020 7321 0000Michael Oke / Andrew Mills This press release has been issued by TRG and is the sole responsibility of TRG.This press release does not contain or constitute an offer or invitation topurchase or subscribe for any securities of TRG and should not be relied on inconnection with any decision to purchase or subscribe for any such securities. The securities referred to herein have not been and will not be registered underthe U.S. Securities Act of 1933 and may not be offered or sold in the UnitedStates absent registration under the Securities Act or an available exemptionfrom it. Arbuthnot Securities Limited ("Arbuthnot"), which is regulated by the FinancialServices Authority, is acting for TRG and no-one else in relation to the mattersdescribed in this announcement and will not be responsible to anyone other thanTRG for providing the protections afforded to clients of Arbuthnot nor forproviding advice in relation to the matters described in this announcement. This information is provided by RNS The company news service from the London Stock Exchange