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Metal Tiger Plc

Metal Tiger Southern Gold offer revised A$4 Million fundraise

Metal Tiger plc (LON:MTR), the London Stock Exchange AIM listed investor in natural resource opportunities, today noted that, further to its announcements of 10 and 11 February 2020 regarding the Company’s participation in a conditional A$10 million share placement by ASX-listed, Southern Gold Limited, Southern Gold has withdrawn the placement owing to market conditions.

Southern Gold has instead offered an alternative opportunity for a subscription of, in aggregate, 40,000,000 Southern Gold shares at 10c per share, to raise A$4 million before costs, to be settled in two tranches (the “Revised Fundraise”). Metal Tiger has participated in the Revised Fundraise through a subscription for, in aggregate, 22,000,000 shares at a total cost of A$2.2 million.

The second tranche of the Revised Fundraise, equating to A$1,831,999.80 million, is conditional upon Southern Gold shareholder approval at a duly convened general meeting (expected to be held in early May) (“Approval”). On completion of the first tranche, which will occur shortly, Metal Tiger will receive 5,020,002 new ordinary shares in Southern Gold. Subject to Approval, Metal Tiger will receive a further 16,979,998 new ordinary shares in Southern Gold pursuant to the second tranche.

Following completion of the Revised Fundraise, Metal Tiger will hold a 17.1% interest in Southern Gold. In addition, Metal Tiger will retain the right to nominate one director to the board of Southern Gold for so long as it holds an interest in the company of at least 10%. Under this provision, Metal Tiger Non-Executive Director, Mr Terry Grammer, has been nominated and will join the Southern Gold board following Approval.

The board of Southern Gold has committed to hold, within 3 months of completion of the Revised Fundraise, a strategic review session which will be attended by members of the board (including Terry Grammer and Douglas Kirwin) as well as senior management.

Assuming completion of the Revised Fundraise, Southern Gold will have a cash balance of A$5.5 million, which is expected to support diamond drilling of multiple targets over a minimum 12-month period.

Southern Gold’s announcement can be accessed via the following hyperlink:

https://www.asx.com.au/asxpdf/20200323/pdf/44g8xqdbzr0878.pdf

For the year ended 30 June 2019, Southern Gold reported a loss before tax of A$10.1 million. As at 31 December 2019, Southern Gold reported net assets of A$8.6 million.

Michael McNeilly, Chief Executive Officer of Metal Tiger, commented:

“We are delighted to have cornerstoned this revised placing; the fact that Southern Gold has been able to restructure the fundraise in such challenging markets is a testament to the quality of the Southern Gold team and its assets. In addition, our participation in the fundraise demonstrates our continued ability to seek and finance opportunities globally and across commodities in uncertain markets. We believe that Southern Gold’s drilling campaign, which will include significant news flow over a 12-month period, is a high-impact opportunity and is another example of our Board identifying unique opportunities in order to drive shareholder value.

“We look forward to progress being achieved and to updating shareholders on further developments across our portfolio in the near future.”

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Disclaimer: Statements in this article should not be considered investment advice, which is best sought directly from a qualified professional.