6th Jun 2016 07:24
LONDON (Alliance News) - CIC Gold Group Ltd Monday said it has replaced the initial acquisition agreement with Gobi Minerals with a share purchase agreement as the London-listed gold miner edges ever-closer to completing its acquisition of a substantial stake in the company.
CIC Gold struck an initial agreement to purchase an 80% stake in Gobi Minerals back in November last year as the company looks to snap up Gobi's Tsagaan Suvarga gold and copper asset situated in the South Gobi region of Mongolia.
The original deal was for CIC to acquire the stake in Gobi for GBP5.6 million by issuing 280.0 million shares to the sellers - but this has now been adjusted.
CIC will now sell 70.0 million of the 280.0 million shares and pass on the funds raised to the sellers of Gobi. This is being done because CIC is required to have at least 25% of its issued share capital in the hands of European Economic Area residents.
That means CIC will now be issuing the sellers with 210.0 million CIC shares and the proceeds from selling 70.0 million shares.
CIC Gold currently has 103.6 million shares in issue - meaning the 280.0 million shares will represent 72.99% of the company's enlarged issued share capital whilst 210.0 million shares will represent 54.74% of the enlarged issued share capital.
The miner said the sellers will now required to transfer the mineral title that covers the Tsagaan Suvarga gold and copper asset within 12 months of CIC shares being readmitted to trading and the sellers will not be able to sell their shares in CIC during the 12 month period that follows the readmission of CIC shares.
Once CIC has had its shares readmitted to trading, the company will own an 80% stake in Gobi Minerals, which owns 100% of the gold and copper project which is covered by the mineral title covering the Ulaan Tsokhio lease, which will be renamed Altan Tobchi, the company said.
Notably, CIC said the 80% stake in Gobi Minerals will be held by Barsbold Ulambayar, who will be a director of CIC and Gobi Minerals once the deal is completed, as the "bare trustee" of the company.
"The company expects to commence the process of seeking eligibility for re-admission of the enlarged group and submitting a draft prospectus for review by the United Kingdom Listing Authority in due course," said CIC.
By Joshua Warner; [email protected]; @JoshAlliance
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