Kabwe Residual Rights – Acquisition Completes

RNS Number : 0926D
Galileo Resources PLC
24 June 2019

For immediate release

 

Dissemination of a Regulatory Announcement that contains inside information according to REGULATION (EU) No 596/2014 (MAR).

24  June 2019

 

Galileo Resources Plc
(“Galileo” or “the Company”)

Kabwe Residual Rights – Galileo Completes Acquisition

Issue of Equity

 

 

Highlights:

 

·          The Company has acquired the Kabwe Residual Rights, which includes the Kashitu Zinc willemite (a) prospect (“Kashitu Zinc”), and the Sale Shares: being the 15% of the shares in Galileo’s  subsidiary Enviro Zambia Limited  that it previously did not own

 

·          The Sale Shares increase the Company’s beneficial interest in the Star Zinc project to 95% (from previous 80.75%) with the Zambian government holding 5%

 

·          Kashitu Zinc is some 6 km from Jubilee Metals Group plc ‘s (“JMG”) Kabwe zinc refinery plant, which JMG is developing to process its own willemite-bearing tailings and so potentially available to treat ore as well from Star Zinc

 

·          The directors believe, that Kashitu Zinc has similar mineralisation to Star Zinc and future potential “ore” from Kashitu could  supplement that from Star Zinc

 

·          Historically, vanadium has been identified on Kashitu Zinc. 

 

·          Kashitu Zinc  licence area is bigger than Star Zinc and  is therefore  believed to have the potential for  a much larger tonnage  based on interpretation of historical exploration  on the prospect

 

(a)  Willemite  a zinc silicate ore mineral

 

Galileo is pleased to announce that, pursuant to the Binding Heads of Terms (announced 13 September 2018)  and paragraph 13.2  therein, it has exercised its right,  at its sole election and risk, to proceed  to the completion of the Proposed Transaction, namely  the acquisition of the Kabwe Residual Rights, including the Kashitu Zinc willemite exploration prospect (“Kashitu Zinc”) and the remaining 15% of the shares, that Galileo currently does not hold in Enviro Zambia Limited(the “Sale Shares”) (together the “Acquisition”) (even if the terms of the Transaction Documents  have not yet been agreed),  by giving notice in writing (the “Completion Notice”) to the BMR Group plc (“BMR”) to proceed. The consideration for the Acquisition comprises a cash component of £50,000  and the issuance  of 15,000,000 Galileo ordinary shares  (“Consideration  Shares”) of par 0.1p (“Ordinary Share”) to BMR at a price of 1.15p per Ordinary Share  Also, in terms of the Binding Heads of Terms ,  Galileo has elected and BMR has  agreed  to  the issuance of 9,615,385 Galileo ordinary shares priced at 0.52p (“Additional Consideration Shares”) in lieu of the £50,000 cash payment.  As a result of the Acquisition, Galileo increases its interest in Enviro Zambia Limited from 85% to 100%. Enviro Zambia Limited owns 95% of Enviro Processing Zambia Limited, to which Star Zinc’s large-scale exploration licence 19653-HQ-LEL remains to be transferred, subject to Zambian regulatory approval, from a wholly owned subsidiary of BMR, Enviro Processing Limited.  

 

Colin Bird, Galileo CEO said ” Completion of this acquisition, adds substantially to the Company’s prospective zinc metal base and has increased its beneficial interest to 95%  in its advanced Star Zinc project. The Kashitu Zinc mineralisation has the added benefit of vanadium, which in today’s terms , will add significant value to the overall metal package.  Historical   evidence  has indicated large tracts of  willemite together with potential for sulphides and  that the  Kashitu concession is larger than Star Zinc. Its  proximity to the Kabwe refinery adds potentially immense value to the  acquisition. We look forward to defining the quantum of this prospective deposit”

Application will be made to the London Stock Exchange for a total of 28,215,385 new ordinary shares of 0.1p each, (“New Shares”)   to be admitted to trading on AIM. The New Shares comprise the  above-mentioned  24,615,385 Consideration and Additional Consideration Shares, and 3,600,000  new ordinary  shares to be issued in lieu of broker fees,  the latter priced  at of 0.50p per Ordinary Share.  The  New Shares have been issued and allotted in terms of the company’s general authority to issue shares, obtained at its annual general meeting on 5  September 2018.

 

The New Shares will rank pari passu in all respects with the existing Ordinary  Shares of the company. These New Shares are  expected to be admitted to trading on AIM on or around 27  June  2019. The New Shares will, when issued, rank pari passu in all respects with the existing Ordinary Shares.

Following the issue of the New Shares, the Company’s issued share capital will total 433,911,947 Ordinary Shares, with voting rights. Shareholders in the Company may use this figure as the denominator for the calculation, by which they would determine if they are required to notify their interest in, or a change to their interest in, the share capital of the Company under the Financial Conduct Authority’s Disclosure and Transparency Rules.

 

You can also follow Galileo on Twitter: @GalileoResource

 

For further information, please contact: Galileo Resources PLC

 

Colin Bird, Chairman

Andrew Sarosi, Executive Director

Tel +44 (0) 20 7581 4477

Tel +44 (0) 1752 221937

Beaumont Cornish Limited – Nomad

Roland Cornish/James Biddle

Tel +44 (0) 20 7628 3396

Novum Securities Limited – Joint Broker

Colin Rowbury /Jon Belliss

+44 (0) 20 7399 9400

Shard Capital Partners LLP – Joint Broker

Damon Heath

Tel +44 (0) 20 7186 9952

 

 

 


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