Completion of US$52 million Financing Package

RNS Number : 5399O

Chaarat Gold Holdings Ltd

10 February 2021

 

10 February 2021

Chaarat Gold Holdings Limited - (AIM:CGH)

("Chaarat" or the "Company")

Completion of US$ 52 million Financing Package

Equity Raise and Debt Conversion

Chaarat (AIM:CGH), the AIM-quoted gold mining company with assets in the Kyrgyz Republic and Armenia is pleased to announce that, further to the announcement of 05 February 2021, it has completed a c. US$ 52 million financing package through an equity fundraise of US$ 30.0 million and a debt to equity conversion with Labro Investments Ltd. of US$ 22 million (together the "Financing").  

In addition to the previously announced equity commitments, the Company is pleased to confirm that the non-binding commitments for US$ 1.4 million are now binding commitments and that it has received further binding commitments for US$ 5.1 million (together the "Additional Subscriptions"). A total of 18,206,461 new ordinary shares of US$0.01 each (the "Additional Subscription Shares") will be issued at the Issue Price of 26p. Accordingly, the Additional Subscriptions when aggregated with the previously announced commitments for US$ 23.5 million, means the Company has completed an equity raise of US$ 30.0 million from new and existing investors.

Highlights

· The Company exceeded its previously announced target of US$ 25 million in the Financing due to strong demand from new equity investors.

· The Financing leads to a significant improvement in the Company's debt position reducing it from US$ 70.5 million as at 31 December 2020 to US$ 46.5 million, a reduction of 33%. The net debt position is reduced from US$ 64.5 million as at 31 December 2020 to US$ 12.5 million, a reduction of 80%.

· It is expected that the funds received from the equity fundraise will represent the remainder of the upfront equity portion required to fund the Tulkubash project in the Kyrgyz Republic and fulfils one of the key criteria in order to draw on any debt project finance facility that is arranged.

· The Company is now focusing on completing the Tulkubash debt financing of approximately US$ 80 million during H1 2021 in order to fully fund the project construction capital of approximately US$ 110 million.

· With the above-mentioned Labro debt-to-equity conversion the Labro Term Loan has been extinguished, saving the Company US$ 2.1 million a year in interest payments from 2021 to 2024.

Application has been made to the London Stock Exchange for the 18,206,461 Additional Subscription Shares to be admitted to trading on AIM (the "Additional Admission"), and it is expected that Additional Admission will become effective and dealings in the new ordinary shares will commence at or around 8:00am (London time) on 15 February 2021.

Following the Additional Admission:

• the Company's enlarged issued share capital will comprise 686,612,153 ordinary shares of US$0.01 each. This figure may be used by shareholders of the Company as the denominator for the calculations by which they will determine whether they are required to notify their interest in, or a change to their interest in, the Company under the Financial Conduct Authority's Disclosure Guidance and Transparency Rules Sourcebook;

• Labro's and Martin Andersson's percentage holdings in the issued ordinary share capital of the Company will be:

	№ of shares	% of issued share capital
Labro	281,527,967	41.00%
Martin Andersson	5,829,996	0.85%
Combined Total	287,357,963	41.85%

All capitalised terms shall have the same meaning as in the announcement on 5 February 2021 unless otherwise indicated.

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) 596/2014.

The Additional Subscription Shares, when issued, will be fully paid, and will rank pari passu in all respects with the existing Ordinary Shares, including the right to receive all dividends and other distributions declared, made or paid after the date of issue. 

Labro also holds loan notes for US$1,000,000 (the "LoanNotes") convertible into 2,849,330 ordinary shares of US$0.01 each in the capital of the Company ("Ordinary Shares") (assuming full conversion of principal and interest to maturity).  If all the Loan Notes were subsequently converted (assuming full conversion of principal and interest to maturity if no options to subscribe for Ordinary Shares issued by the Company were exercised, no other convertible loan notes issued by the Company were converted and no other Ordinary Shares were issued), Labro would hold 284,377,297 Ordinary Shares representing 41,25% of the resulting enlarged share capital.

Pursuant to restricted share awards and share options granted by the Company to Mr Andersson, he may become entitled to a further 18,474,057 Ordinary Shares. If Mr Andersson were to acquire all the shares to which he may become entitled (and no other options to subscribe for Ordinary Shares issued by the Company were exercised and no other Ordinary Shares were issued), on a combined basis, Labro and Mr Andersson would together hold 308,319,114 Ordinary Shares representing 43.69% of the resulting enlarged share capital.

Enquiries

Chaarat Gold Holdings Limited	[phone]
Artem Volynets (CEO)	[e-mail]
Canaccord Genuity Limited (NOMAD and Joint Broker)	+ 44 (0)20 7523 8000
Henry Fitzgerald-O'Connor
James Asensio
Panmure Gordon (UK) Limited (Joint Broker)	[phone]
John Prior
Hugh Rich
finnCap Limited (Joint Broker)	[phone]
Christopher Raggett

About Chaarat

Chaarat is a gold mining company which owns the Kapan operating mine in Armenia as well as Tulkubash and Kyzyltash Gold Projects in the Kyrgyz Republic. The Company has a clear strategy to build a leading emerging markets gold company with an initial focus on the FSU through organic growth and selective M&A.

Chaarat is engaged in active community engagement programmes to optimise the value of the Chaarat investment proposition.

Chaarat aims to create value for its shareholders, employees and communities from its high-quality gold and mineral deposits by building relationships based on trust and operating to the best environmental, social and employment standards. Further information is available at  www.chaarat.com/ .

 

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