14th Jan 2015 11:52
LONDON (Alliance News) - Metal Tiger PLC Wednesday said it will now look to finalise a joint venture agreement for uranium exploration with Kibo Mining PLC, citing its satisfaction with the results of its due diligence of KIbo's uranium-prospective Pinewood portfolio in Tanzania.
Under an agreement, Metal Tiger is to be issued with 10 million warrants for 10 million new shares in Kibo, with an exercise price of 3p each and a term of three years from the date of issue.
Metal Tiger said it also has entered into exclusive discussions with Kibo to agree the terms of a joint venture on Kibo's gold-prospective Morogoro South project.
"Metal Tiger takes a medium-term view with regard to its material investments and seeks out opportunities with the potential to generate a multiple on invested capital," Metal Tiger Chief Executive Cameron Parry said in a statement.
"Reflecting our view that Kibo is still significantly undervalued and has the potential for transformational commercial milestones, Metal Tiger will be immediately exercising its 10 million warrants for a total payment to Kibo of GBP300,000 from Metal Tiger's existing cash resources," Parry added.
Kibo confirmed that it has received an immediate notice of exercise for the 10 million Metal Tiger warrants, as well as the exclusive discussions on the terms of a joint venture on the Morogoro South project.
"We are pleased that the Pinewood due diligence is complete and that Metal Tiger and Kibo Mining can now move forward together with the planned joint venture," Kibo Chief Executive Louis Coetzee said in a statement. "As a result, the exploration of our prospective uranium licences at Pinewood is now reactivated, and we look forward greatly to news flow from these interests."
Coetzee said the additional GBP300,000 from the warrant exercise will bolster Kibo's cash position and enable it to undertake its work and finalise "appropriate" third party project based negotiations.
Kibo shares were up 3.7% at 7.65 pence on Wednesday, while Metal Tiger shares were up 20% at 0.990 pence.
By Samuel Agini; [email protected]; @samuelagini
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