RE-ADMISSION OF KIBO SHARES

RNS Number : 0232K

Kibo Mining Plc

15 August 2012

 



Kibo Mining Plc

(Incorporated in Ireland)

(Registration Number: 451931)

(External registration number: 2011/007371/10)

Share code on the JSE Limited: KBO

Share code on the AIM: KIBO

ISIN: IE00B61XQX41

("Kibo" or "the Company")

RE-ADMISSION OF KIBO SHARES TO TRADING ON AIM AND THE JSE, EXECUTION OF GBP 3 MILLION SHARE PURCHASE FACILITY, AND ACHIEVEMENT OF REVERSE TAKEOVER OFFER ACCEPTANCE THRESHOLDS

·    Publication of Admission Document in relation to reverse takeover acquisitions of Mzuri Energy and Mayborn Resource Investments

·    Suspension on AIM and JSE lifted

·    GBP 3 million share purchase facility to provide additional working capital

·    First tranche under share purchase agreement priced at 2.5p per share

·    100% acceptances from Mayborn shareholders received

·    98.5% acceptances from Mzuri Energy shareholders received at this stage

·    Extraordinary General Meeting to approve RTO acquisitions scheduled for 6 September 2012

Dated: 15 August 2012

Kibo Mining plc ("Kibo" or the "Company") (AIM: KIBO), (JSE: KBO), the Tanzania focused mineral exploration and development company, is pleased to provide this update on the progress of its proposed all share acquisitions of Mzuri Energy Limited ("Mzuri Energy") and Mayborn Resource Investments (Pty) Ltd ("Mayborn"). Mzuri Energy and Mayborn hold coal and uranium exploration projects in Tanzania that have significant potential and will complement and enhance Kibo's portfolio of mineral projects in Tanzania.

Suspension Lifted with Publication of Admission Document

The acquisitions of Mzuri Energy and Mayborn constitute reverse takeovers under the rules of the AIM and JSE AltX markets and pursuant to these rules, Kibo's ordinary shares were suspended from trading on AIM and the JSE AltX pending the publication of a new "Admission Document" setting our full details on the acquisitions and on the enlarged group. Kibo is pleased to report that it has now published this Admission Document, and has received approval from AIM and the JSE for the recommencement of trading in its shares from the opening of the markets on 15 August 2012, trading on the JSE will be halted until the commencement of trade in London. A copy of the Admission Document is available on Kibo's website at www.kibomining.com.

Acceptance of Kibo's offers to shareholders of Mzuri Energy and Mayborn

The Company is also pleased to report that 100% of the shareholders of Mayborn have accepted its offer to acquire their Mayborn shares subject to the fulfillment of the conditions precedent to the Mzuri Energy acquisition agreement.

The Company is also pleased to report that over 98% of the shareholders of Mzuri Energy have so far accepted its offer to acquire their Mzuri Energy shares subject to the fulfillment of the conditions precedent to the Mzuri Energy Limited Acquisition Agreement. Kibo expects that it will shortly reach 100% acceptances from Mzuri Energy shareholders.

These acceptance levels are above the minimum required acceptance levels of 51% for the acquisitions.

GBP 3 million Share Purchase Facility procured

The Company has entered into an agreement with YA Global Master SPV Ltd ("YA Global"), a specialist fund managed by Yorkville Advisors LLC, to provide a standby funding facility for a period of up to three years (the "Facility"). Under the Facility YA Global will subscribe for ordinary shares in the Company with a minimum gross subscription proceeds of GBP 500,000 (the "Minimum Drawdown").  Subject to certain conditions under the Facility, the maximum gross subscription for ordinary shares in the Company which may be made under the Facility will be GBP 3,000,000. The Facility will be drawn down in minimum tranches of GBP30,000 and maximum tranches which cannot exceed: (a) such amount as would result in YA Global holding more than 2.99% of the entire issued share capital of the Company or 0.99% if the Company is in a takeover period; (b) an amount equal to 400% of the average daily traded volume of the ordinary shares of the Company multiplied by the volume weighted average price of the ordinary shares (the "VWAP") on AIM for the 10 trading day period immediately prior to the date of the relevant advance notice or; (c) such other amount as may be mutually agreed by the parties. The first tranche will be drawn down at an issue price of 2.5 Pence per share. An amount of GBP2.500.000 of the Facility is optional and can be drawn down at the sole election of the Company.

The cost of the Facility consists of a 2.5% commission on the Minimum Drawdown reducing to a 2% commission on advances in excess of the Minimum Drawdown and a 3.25% implementation fee on the maximum facility. Save in respect of the first advance (as detailed above), ordinary shares subscribed for under the Facility will be issued at 95% of the average of the five lowest VWAPs during the 20 trading days immediately following a request for an advance or such other period as the Company and YA Global shall agree (the "Pricing Period") for amounts up to the Minimum Drawdown and at 95% of the average of the ten lowest VWAPs during the Pricing Period on amounts in excess of the Minimum Drawdown. The Company may set a minimum acceptable price for ordinary shares issued under the Facility which must be less than or equal to 90% of the VWAP of the ordinary shares on the trading day immediately preceding the date of an advance notice and must be no lower than 105.3% of the nominal value of the ordinary shares. Such minimum acceptable price will not apply to amounts up to £30,000 under the Minimum Drawdown.

Until such time as the Minimum Drawdown has been reached, the Company shall grant warrants to YA Global exercisable at the subscription price of the respective advance if in respect of such advance the amount that is equal to 400% of the average of the daily value of ordinary shares traded for each of the previous ten trading days is less than £30,000. The number of warrants to be issued shall be, in each case, such number of warrants as is equal to the £30,000 divided by the subscription price for such advance up to a maximum value of £500,000 at the relevant subscription prices.

Extraordinary General Meeting and Closing

In fulfillment of part of the conditions precedent governing the Mzuri Energy acquisition agreement, the Company has dispatched a copy of the Admission Document to shareholders.  The Admission Document also includes a notice to shareholders convening an Extraordinary General Meeting for 6 September 2012 where, inter alia, shareholders will be asked to approve the implementation of the Mzuri Energy acquisition agreement in accordance with its terms.

It is anticipated that the all share acquisitions of Mzuri Energy and Mayborn will close and the enlarged share capital of Kibo will commence trading on AIM and the JSE on the first trading day after the Extraordinary General Meeting.

Meaningful Support for Achievements

Commenting on the progress made towards closing the acquisitions of Mzuri Energy and Mayborn, Kibo CEO Louis Coetzee said:

"These past weeks have been challenging for smaller mining companies, and we were greatly encouraged by the overwhelming support for the Mzuri acquisition not only from the shareholders of Mzuri Energy and Mayborn, but also from many of our own shareholders who have expressed support in anticipation of the upcoming Extraordinary General Meeting.

We are particularly pleased that the Company has been able to procure a GBP 3 million funding facility with the level of flexibility and optionality that Yorkville has been able to provide. The Company is now well positioned to pursue the closing of the Mzuri merger over the next three weeks, and to complete the integration of the enlarged group's projects in Tanzania over the remainder of the summer.  "

Enquiries:

Louis Coetzee	[phone]		Kibo Mining plc	Chief Executive Officer
Stuart Laing	[phone]		RFC Corporate Finance Limited	Nominated Adviser on AIM
Andreas Lianos	[phone]		River Group	Corporate Adviser and Designated Adviser on JSE
Nick Bealer	[phone]		Cornhill Capital Ltd	Joint Broker
Matthew Johnson		[phone]	Northland Capital Partners Limited	Joint Broker
Tim Metcalfe		[phone]	Northland Capital Partners Limited	Joint Broker
Matt Beale	[phone]		Fortbridge	Public Relations

Updates on the Company's activities are regularly posted on its website www.kibomining.com

General Background & Strategy

Kibo is a public company registered in Ireland (company number 451931). Its registered office is Kibo Mining plc, Suite 3, One Earlsfort Centre, Lower Hatch Street, Dublin 2, Ireland. Kibo was established in early 2008 to explore and develop mineral deposits in Tanzania, East Africa and was admitted to AIM on 27 April 2010 and AltX in South Africa on 30 May 2011.

The Board of Kibo is composed of professionals whose experience include mineral exploration, mine development, mining finance, tax, law, mergers and acquisitions, and financial control of public companies. It is supported by a competent and motivated Tanzanian staff that operates from Kibo's operations office in Dar es Salaam.

The mineral assets of the Company comprise three existing and two newly acquired projects in Tanzania - Haneti (nickel, PGE and gold), Morogoro (Gold) and Lake Victoria (Gold) which give Kibo access to over 18,000 km² of early stage exploration licences in Tanzania's premier gold mining region, the Lake Victoria Goldfield and within the newly emerging gold exploration regions in eastern Tanzania.

The proposed acquisitions of Mzuri Energy and Mayborn will add the advanced Rukwa thermal coal project and the Pinewood uranium exploration project to Kibo's portfolio of mineral projects in Tanzania.

The Rukwa and Pinewood projects will provide Kibo shareholders with exposure to an attractive portfolio of strategic energy assetsin Tanzania. Importantly, they are situated within and close to the Mtwara Corridor, an area where the Tanzanian Government has committed to significant infrastructure development and which has seen recent multi-million dollar investment in coal and coal-fired power stations and uranium exploration.

The Rukwa project is substantially more advanced than Kibo's existing exploration projects, with a significant Mineral Resource of thermal coal already defined. This provides nearer term development and commercialisation potential, complementing the earlier stage existing projects held by Kibo. This is further supported by the memorandum of understanding that has already been entered into with a major Asian conglomerate for the development of a coal mine and mine-mouth coal-fired power plant based on the Rukwa project. 

In addition, the Pinewood project encompasses a significant ground holding of prospective Karoo sequence sedimentary rocks. These sediments are attracting considerable interest from international companies exploring for uranium and coal mineralisation following some notable discoveries in recent years.

Kibo's objective is to build shareholder value in a sustainable manner. This objective will be pursued primarily through active exploration of its own projects and by using the Company's experience in Tanzania to acquire attractive exploration and development assets on competitive terms that can be moved swiftly up the value curve by using the company's own skills base whilst also seeking to benefit from strategic collaborative relationships with industry leaders who have special skills and competencies within their chosen fields of focus. Kibo will undertake continual risk assessment of its projects and take whatever actions it believes are necessary to ensure that these risks are mitigated.

London

15 August 2012

Corporate and Designate Adviser

River Group

 

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