6th Apr 2016 13:53
LONDON (Alliance News) - Metal Tiger PLC Wednesday said it agreed to invest around GBP150,000 into fellow London-listed Greatland Gold PLC, which will lead to the former restructuring its board and launching a strategic review of the business.
Greatland Gold shares were up 27% to 0.172 pence per share on Wednesday morning whilst Metal Tiger shares were up 14.3% to 6.0 pence.
Metal Tiger, a natural resources investment company, will invest the funds to acquire 150.0 million shares in Greatland Gold priced at 0.10 pence each, giving Metal Tiger a 12.6% stake in the company.
Metal Tiger will also be awarded 150.0 million warrants to boost its stake further by purchasing more shares at a price of 0.20 pence each within a three year period.
Greatland Gold released its own statement Wednesday, confirming Metal Tiger was investing and revealing it has struck another deal with Starvest PLC, which will acquire 50.0 million shares at 0.10 pence each on the same basis.
Greatland Gold Directors Callum Baxter and John Watkins are both directors of Starvest.
Starvest shares were trading up 12% to 1.40 pence per share on Wednesday.
Following the deals, Greatland said Watkins has stood down as a non-executive of the board, and that it will appoint the current Chief Executive of Metal Tiger, Paul Johnson, and Metal Tiger Non-Executive Alex Borelli as new non-executive directors of Greatland Gold.
Andrew Bell, the current chairman of Greatland Gold, will retain his role whilst Baxter's role at the company will revert to an executive one from a non-executive one.
The new board has plunged into its first task, which will lead to a strategic review of Greatland Gold being launched. That will look at the company's existing exploration interests, existing pipeline opportunities as well as other advanced opportunities that may be suitable.
The Greatland Gold Directors will be rewarded beyond their basic salary, with Greatland stating it will issue 100.0 million options to the board which would allow them to convert those options into shares within the next three years at an exercise price of 0.20 pence each.
Following the deal Wednesday, Metal tiger will hold a 12.6% stake in Greatland whilst Starvest will hold a 7.2% stake. Metal Tiger Chief and now a Non-Executive of Greatland, Johnson, will be interested in shares equal to a 4.56% stake in Greatland.
"We are delighted to announce the investment in Greatland Gold which exposes Metal Tiger shareholders to equity and warrant upside in a clean resource operating company at a modest valuation given the recent resource sector apathy in the markets," said Metal Tiger Chairman Terry Grammer.
"We welcome the appointment of our two proposed directors, Paul Johnson and Alex Borelli. Metal Tiger is a company that has seen its share price rise from 0.50p in mid-2014 when Metal Tiger was created, up to 5.5p a share recently. That is a 1,000% share price return for investors in a resource investing company over one of the worst resource bear markets in recent history," said Greatland Gold Chairman Andrew Bell.
By Joshua Warner; [email protected]; @JoshAlliance
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