Bushveld Minerals Limited (LON:BMN), the integrated vanadium producer with additional investments in coal, power and tin, yesterday announced that it has conditionally raised approximately US$22.2 million (£15.7 million) (before expenses) by way of an oversubscribed placing of 152,749,172 new ordinary shares of 1 penny each (the “Placing Shares”) at a price of 10.3 pence per share with leading institutional and mining investors (the “Placing”). The price was calculated as the 5 day volume weighted average price (as published by Bloomberg) at close of trading Monday 19 March 2018. The Placing Shares will represent approximately 14.4% of the Company’s issued share capital on Admission (as defined below).
SP Angel Corporate Finance LLP and Alternative Resource Capital, a trading name of Shard Capital Partners LLP, acted as joint brokers (the “Joint Brokers”) to the Company in connection with the Placing.
The Placing was led by a consortium of cornerstone investors, including the original founders of Mimosa Platinum and LionOre Mining International (“LionOre”), as well as the key investors in Mantra Resources at its inception. In 2007, LionOre was bought by Norilsk Nickel for US$6.3 billion. Mantra Resources was sold to Rosatom of Russia in 2010 for US$1.6 billion.
The planned use of the net proceeds of the Placing, being approximately US$20.9 million (£14.9 million), is to:
· Redeem the outstanding Atlas Capital Convertible Bond (US$6.3m) (£4.5 million);
· Simplify Bushveld’s organisational and corporate structure to improve Bushveld’s exposure to the underlying cash flows of its assets (US$9.0m) (£6.4 million); and
· Support Bushveld’s vanadium expansion programme: Expansion of the vanadium reserves and resources at the Vametco mine and Brits Project for future production and support Vametco’s expansion plans to increase production to more than 5,000mtV and beyond (US$5.6m) (£4.0 million).
Fortune Mojapelo, Chief Executive of Bushveld, commented:
“We are delighted by the response from investors to this capital raise which was significantly oversubscribed. We are particularly pleased to welcome to the Company a consortium of highly experienced mining investors as well as several leading UK institutional investors who buy into and support our ambitions to build a significant low cost and integrated primary vanadium Company. The capital raise will allow us to improve our capital and corporate structure and enhance the Company’s proximity to its underlying cash generating assets as we continue to develop our growth opportunities. We are grateful to the existing Bushveld shareholders who have continued to support the Company.”
Redemption of Convertible Loan
Bushveld announces that notice will be served today to redeem and settle in full the outstanding convertible loan issued and held by Atlas Capital Markets Limited (“Atlas”) and its joint venture company, Atlas Special Opportunities Limited. The Company has agreed to make a full and final repayment of £4.275m, being the outstanding nominal amount of the convertible loan, plus a 5% early redemption charges to Atlas to redeem all these remaining outstanding convertible bonds.
Details of the Placing
The Placing is conditional, amongst other things, on the admission of the Placing Shares to trading on the AIM market of the London Stock Exchange (“Admission”) by 29 March 2018 (or such later date as the Company may agree with the Joint Brokers, being not later than 30 April 2018). Application has been made for admission of these 152,749,172 new Ordinary Shares to trading on AIM and it is expected that Admission and dealings in the Placing Shares will commence at 8.00 a.m. on 29 March 2018.
Voting Rights
Following Admission, there will be a total of 1,061,333,862 Ordinary Shares in issue, 670,000 of which are held in treasury. Shareholders should use the figure of 1,060,663,862 as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company under the FCA’s Disclosure Guidance and Transparency Rules.
Market Abuse Regulation Disclosure
Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 (“MAR”) until the release of this announcement. In addition, market soundings (as defined in MAR) were taken in respect of the placing and other matters contained in this announcement, with the result that certain persons became aware of such inside information, as permitted by MAR. That inside information is set out in this announcement and is now considered to be in the public domain. Therefore, upon the publication of this announcement, those persons that received is inside information in a market sounding are no longer in possession of inside information relating to the Company and its securities.
