Suspension Of Listing And Proposed Acquisition

RNS Number : 4010M

Amala Foods PLC

23 May 2022

 

Amala Foods Plc

( " Amala " or the " Company")

Suspension Of Listing

and

Proposed Acquisition

Highlights:

· SPA executed that paves the way for a complete transformation of the Company into the globally significant Rare Earths Elements ("REE") sector;

· Appointment of Gerard Kisbey-Green

· Disposal of stake in Amala Foods Inc.

Amala Foods Plc (LON: DISH) further to the Company's announcement on 16 March 2022 the Company is pleased to announce the execution of a Sale and Purchase Agreement ("SPA") to acquire the entire issued share capital of Terra Rara UK Ltd ("TRUK") conditional upon the satisfaction of a number of conditions.  TRUK indirectly owns interests in two rare earth projects that are in Angola and Uganda.  The Proposed Acquisition constitutes a reverse takeover for the purposes of the Listing Rules and therefore the Proposed Acquisition is conditional upon the Company publishing a prospectus and successfully re-applying for admission to the Official List of its ordinary shares ("Readmission").

The agreed consideration for the transfer of the entire issued share capital of TRUK to the Company ("Proposed Acquisition") is to be paid wholly in ordinary shares in the Company that represent 55% of the enlarged issued share capital of the Company on Readmission.  These consideration shares will be issued at the price of the ordinary shares on Readmission.  The Proposed Acquisition is also conditional on, amongst other things:

· the raising of an appropriate amount of new equity funds by the Company;

· the Takeover Panel waiving any obligation owners of TRUK (and any persons acting in concert with them) might otherwise incur under Rule 9 of the City Code by virtue the issue to them of consideration shares (the "Rule 9 Waiver"); and

· the passing of necessary resolutions to approve the Proposed Acquisition (including the Rule 9 Waiver) by the shareholders of the Company at a duly convened general meeting (the "General Meeting").

The Company is targeting a Readmission in Autumn 2022.  It is anticipated that the Company will be renamed upon completion of the Proposed Acquisition and that Aidan Bishop the Company's founder will step down from the Board at completion.  To assist with the Readmission process, the Company has decided to appoint one of the founders of TRUK, Gerard Kisbey-Green, to the Board of Directors with immediate effect.  Mr Kisbey-Green has over 36 years' experience in the mining and related financial industry. He is a qualified mining engineer with extensive mining and resource banking experience  Mr Kisbey-Green has worked on mines in a diversity of commodities and geographies around the world. He has managed large operations and has worked as CEO of a number of private and listed mining and exploration companies. His 17 years of banking experience includes equity analysis as well as corporate finance for major banks in Johannesburg and London including JPMorgan, Investec, and Standard Bank.  Mr Kisbey-Green has no interest in the Company's shares.

In light of the Proposed Acquisition the Company has entered into an agreement to dispose of its stake in the Philippine joint venture company, Amala Foods Inc ( " AFI " ) to its local partner .  The Company was granted a 70% equity interest in AFI but was required to invest a total of USD 1 million in AFI to retain this stake .  The Company, has to date, has invested a total of USD 277,488 which allows the Company to retain a 19.4% stake in the joint venture company with AFI having a right to claw back the 50.6% .  The Company has decided it does not want to devote any more capital to the development of the AFI business and has agreed to dispose its stake for USD 277,488 in cash, which will be set off against the Company's existing borrowing.  

The Company has also discontinued all technology development of previous operations.

Following the disposal of the interest in AFI, the Company will be regarded as a shell company.  The Company has requested a suspension of the listing because the shell company is in contemplation of a potential reverse takeover transaction and that there will be insufficient publicly available information relating to the proposed transaction.  The listing has now been suspended.

Gerard Kisbey Green, Executive Director of Terra Rara UK, commented:

"I look forward to joining the Board of Amala and working with the team to expedite the REE transaction, raise capital and begin work on the ground in both Angola and Uganda as soon as possible. This is an opportune time to be investing in and developing good quality REE projects which should deliver great value to the Amala shareholders."

Aidan Bishop, Director, Amala Foods Plc, commented:

"The execution of the SPA is a significant milestone towards a complete rebirth of the Company that provides value to shareholders in excess of the current share price.  Rare Earth Elements are garnering significant market interest and for good reason.  The Angola and Ugandan projects are located in close proximity to other world class REE projects that are being developed.  I am confident that following solid expressions of interest of finance provision in bringing this opportunity to fruition that shareholders in the company stand on the cusp of a new and exciting beginning".

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF THE MARKET ABUSE REGULATION EU 596/2014 ("MAR").

Enquiries:

Jonathan Morley-Kirk, Non-Executive Chairman

[e-mail]  

 

END

 

 

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