11th Feb 2025 12:09
(Alliance News) - Power Metal Resources PLC on Tuesday said it intends to sell part of its stake in Guardian Metal Resources PLC for a total of GBP9.2 million before costs.
The metals exploration company with projects in North America, Africa, Saudi Arabia and Australia said the sale to UCAM Ltd will see its disposal of 29.8 million GMET shares and warrants granted over 986,352 shares.
The deal will reduce Power Metal's holding in GMET to around 19.2%, or 25.2 million shares.
Completion of the sale is conditional on UCAM's fundraising efforts, administrative processes, and the signing of a sale & purchase agreement between Power Metal Resources and UCAM, which is currently planned for within the next 10 business days.
Power Metal Resources noted that until the agreement is signed, there is no certainty that the deal will proceed as currently described.
"I am very pleased to be able to announce to shareholders the intended monetisation of a portion of our holding in GMET, and with it, to introduce to GMET such a significant strategic investor," said Power Metal Resources Chief Executive Officer Sean Wade. "GMET has been a very successful investment for Power Metal and if the proposed transaction is completed, we will have realised a return on this part of our investment of 966%, or close to 10 times.
"This would represent a strong validation of our incubator model and will hopefully give investors renewed confidence in our ability to generate significant shareholder returns.
"We are committed to our remaining holding in GMET for the foreseeable future and look forward to seeing it continue to grow as part of our portfolio of high-quality assets."
Shares in Power Metal Resources were up 2.3% at 14.57 pence in London around midday on Tuesday. Guardian Metal Resources shares were down 0.3% at 35.68p.
By Emily Parsons, Alliance News reporter
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