Placing completed to raise ?1.7million

RNS Number : 5462U

Galileo Resources PLC

23 December 2011

 



7.00am on 23 December 2011

Galileo Resources Plc

("Galileo" or the "Company")

Placing completed to raise £1.7million

Galileo Resources Plc ("Galileo"), the AIM-quoted emerging African Rare Earth minerals exploration company, is pleased to announce that it has, subject to admission of the new shares to trading on AIM, raised £1.7million before expenses via a placing (the 'Placing') of 4,857,143 new ordinary shares of 5 pence ("Ordinary Shares") each in the capital of the Company (the 'Placing Shares') at a price of 35 pence per Placing Share.

The proceeds of the Placing will be used to increase the rate of exploration and development at the Company's Glenover Rare Earth Project near Thabazimbi, South Africa ("Glenover") over and above the programme set out in the Company's Admission Document.

With the additional expenditure now possible from the Placing the Directors estimate that the Company should be able to earn an interest of up to approximately 35% in Glenover. The additional work provided for by the Placing is towards performance of Phase 2 comprising resource estimation, mining, and flowsheet option analysis selection development and definitive feasibility study with further exploration of in-situ resources arising, if any, out of the Phase 1 results.

The Placing

The Placing has been arranged by both the Company, in respect of 1,985,000 new Ordinary Shares and by Shore Capital Stockbrokers Limited ('Shore Capital') in respect of 2,872,143 new Ordinary Shares. Total commitments have therefore been received in respect of 4,857,143 new Ordinary Shares at 35 pence per Placing Share, raising approximately £1.7 million (before expenses).  The Placing is conditional inter alia on admission of the Placing Shares to trading on AIM ('Admission'). 

Application will be made for the Placing Shares to be admitted to trading on AIM and it is expected that Admission will occur, and dealings in the Placing Shares will commence, on 10 January 2012.

Following completion of the Placing, the Placing Shares will represent approximately 6.43% of the enlarged issued share capital of the Company, which will then comprise 75,557,183 ordinary shares of 5 pence each in the capital of the Company.  The Placing Shares will, when issued, rank pari passu in all respects with the existing issued Ordinary Shares of Galileo.

ENDS

For further information, please contact:

Colin Bird                                                                                     Tel [phone]

Chairman & CEO

Richard Wollenberg                                                                      Tel [phone]

Non-Executive Director

Beaumont Cornish Limited,                                                            Tel [phone]

Nominated Advisor and Broker

Roland Cornish/James Biddle

Shore Capital Stockbrokers Limited                                               Tel [phone]

Joint Broker

Jerry Keen/Toby Gibbs

Bishopsgate Communications                                            Tel [phone]

Nick Rome/Shabnam Bashir                                                    

A copy of the announcement is available on the Company's website www.galileoresources.com

Note:

Galileo Resources Plc is a natural resource exploration company. The Company has an experienced management team with proven technical and commercial background. The flagship property is the Glenover Phosphate concession, which produced phosphate for many years. Phosphate however, is now subordinated to Rare Earth Elements (REEs). The project area is known to contain REEs and that the grades, if of sufficient size and continuity may well lead to a medium-sized operation for the production of REOs.

Galileo Resources currently has an 11.5% interest in the Glenover Project and has the option, via additional stage payments as set out in the Company's Admission Document, to earn up to a maximum interest of 73.73%.

One of the key benefits of the project for a medium-sized operation is that, if REEs, which have been shown to be present in the stockpiles from the previous phosphate operations, can be proven to compliant resource category, the cost of mining it and the associated risks should substantially be reduced.

The concession is of considerable size and hosts mineralisation types suitable for potential REE presence. The aim is to investigate the mineralisation types for REE presence and content with the view to proving up a mineable resource of REOs.

The Company also has a number of Iron Ore and Manganese exploration projects in the Cape, all of which are in proximity either to current operations or discoveries, which are not currently being processed.

Galileo has rights to joint venture in an aggregate producing quarry close to Mthata in the Eastern Cape. The Directors believe that the quarry is well positioned to supply construction aggregate for the significant potential infrastructure programme being undertaken by local government.

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END

 

 

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