THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION, if you are in any doubt about the contents of this Document you should consult a person authorised under the Financial Services and Markets Act 2000 who specialises in advising on the acquisition of shares and other securities if you are in the United Kingdom, or from another appropriately authorised independent financial adviser if you are in a territory outside the United Kingdom.
This Document is a simplified prospectus in accordance with Article 14 of Regulation (EU) 2017/1129 relating to Blencowe Resources plc (the "Company") which has been approved by the Financial Conduct Authority (the "FCA"), as competent authority under Regulation (EU) 2017/1129 which is part of UK law by virtue of the European Union (Withdrawal) Act 2018 (the "UK Prospectus Regulation") and drawn up as part of a simplified prospectus. The FCA only approves this prospectus as meeting the standards of completeness, comprehensibility and consistency imposed by the UK Prospectus Regulation. Such approval should not be considered as an endorsement of the quality of the securities that are, or the Company which is, the subject of this prospectus. Investors should make their own assessment as to the suitability of investing in the securities. This Document has been drawn up as a simplified prospectus in accordance with Article 14 of the UK Prospectus Regulation.
This Document together with the documents incorporated into it by reference (as set out in Part IV) will be made available to the public in accordance with UK Prospectus Regulation Rule 3.2 by the same being made available free of charge at www.blencoweresources.com and at the Company's registered office at 167-169 Great Portland Street, Fifth Floor, London, England, W1W 5PF.
The Directors, whose names and functions appear on page 33, and the Company accept responsibility for the information contained in this Document. To the best of the knowledge of the Company and the Directors, the information contained in this Document is in accordance with the facts and this Document makes no omission likely to affect the import of such information.
THE WHOLE OF THE TEXT OF THIS DOCUMENT INCLUDING ALL THE INFORMATION INCORPORATED BY REFERENCE SHOULD BE READ BY PROSPECTIVE INVESTORS. IN PARTICULAR YOUR ATTENTION IS SPECIFICALLY DRAWN TO THE DISCUSSION OF CERTAIN RISKS AND OTHER FACTORS THAT SHOULD BE CONSIDERED IN CONNECTION WITH AN INVESTMENT IN THE ORDINARY SHARES AS SET OUT IN THE SECTION ENTITLED "RISK FACTORS" BEGINNING ON PAGE 27 OF THIS DOCUMENT WHICH YOU SHOULD READ IN FULL.
Ax12 (1.5(d))
Ax3 (1.4)
Ax12 (1.4)
Ax3 (1.5)
Ax12 (1.5)
LR 2.2.10(2)(a)
BLENCOWE RESOURCES PLC
(Incorporated in England and Wales with company number 10966847)
Issue of 3,181,260 Ordinary Shares pursuant to the July Subscription
Ax12 (5.3.1)
Issue of 12,500,000 Ordinary Shares pursuant to the November Subscription
Issue of 22,030,000 Fee Shares
Issue of 3,691,250 Fee Shares on passing of Resolutions at the General Meeting
Issue of up to 105,550,555 Ordinary Shares pursuant to the Warrants
Issue of up to 26,100,000 Ordinary Shares pursuant to the Options
Issue of up to 10,700,000 Ordinary Shares pursuant to the DFC Performance Share Options
Admission of the New Ordinary Shares to the Official List to the Equity Shares (transition)
category and to trading on the London Stock Exchange's Main Market
Notice of General Meeting
FINANCIAL ADVISER & BROKER
TAVIRA FINANCIAL LIMITED
Issued share capital immediately following Admission
292,076,620 Ordinary Shares of 0.5 pence each
The current entire issued share capital of the Company ("Existing Ordinary Shares") is admitted to the Official List of the UK Listing Authority (the "Official List") (to the Equity Shares (transition) category) pursuant to the listing rules published by the UK Listing Authority ("Listing Rules")) and to the London Stock Exchange plc ("London Stock Exchange"). Application will be made for the immediate admission of the New Ordinary Shares to trading on the Main Market for listed securities ("Admission").
It is expected that Admission will become effective and that dealings for normal settlement in the Ordinary Shares will commence at 8.00 a.m. (London time) on 2 December 2024. No application is currently intended to be made for the Ordinary Shares to be admitted to listing or dealing on any other exchange. The Company will comply with its obligation to publish a further supplementary prospectus containing further updated information required by law or any regulatory authority but assumes no further obligation to publish additional information.
This document does not constitute an offer to sell or invitation to subscribe for, or solicitation of an offer or invitation to buy or subscribe for, Ordinary Shares in any jurisdiction where such offer or solicitation is unlawful or would impose any unfulfilled registration, publication or approval requirements on the Company.
Tavira Financial Limited ("Tavira") is authorised and regulated by the FCA in the conduct of investment business, are acting exclusively for the Company and for no-one else in connection with the Subscription and Admission and will not be responsible to anyone other than the Company for providing the protections afforded to customers of Tavira or for providing advice in relation to the contents of this Document or any matter referred to in it.
Tavira is not making any representation, express or implied, as to the contents of this Document, for which the Company, the Directors are solely responsible. Apart from the responsibilities and liabilities, if any, which may be imposed on Tavira in their respective capacities as financial adviser and broker to the Company by FSMA or the regulatory regime established thereunder and without limiting the statutory rights of any person to whom this Document is issued, no liability whatsoever is accepted by Tavira for the accuracy of any information or opinions contained in this Document or for any omission of information, for which the Company, the Directors are solely responsible. The information contained in this Document has been prepared solely for the purpose of the July and November Subscription, Fee Shares and Admission and is not intended to be relied upon by any subsequent purchasers of Ordinary Shares (whether on or off exchange) and accordingly no duty of care is accepted in relation to them.
The New Ordinary Shares will rank in full for all dividends or other distributions hereafter declared, made or paid on the ordinary share capital of the Company and will rank pari passu in all other respects with all Existing Ordinary Shares in issue on Admission.
The Ordinary Shares have not been and will not be registered under the United States Securities Act of 1933, as amended ("Securities Act"), or the securities laws of any state or other jurisdiction of the United States or under applicable securities laws of Australia, Canada, Japan or the Republic of South Africa (or their respective territories). Subject to certain exceptions, the Ordinary Shares may not be offered, sold, resold, transferred or distributed directly or indirectly, within, into or in the United States or to or for the account or benefit of persons in the United States, Australia, Canada, Japan, the Republic of South Africa (or their respective territories) or any other jurisdiction where such offer or sale would violate the relevant securities laws of such jurisdiction. This Document does not constitute an offer to sell or a solicitation of an offer to purchase or subscribe for Ordinary Shares in any jurisdiction in which such offer or solicitation is unlawful or would impose any unfulfilled registration, publication or approval requirements on the Company. The Ordinary Shares may not be taken up, offered, sold, resold, transferred or distributed, directly or indirectly within, into or in the United States except pursuant to an exemption from, or in a transaction that is not subject to, the registration requirements of the Securities Act. There will be no public offer in the United States. The Company has not been and will not be registered under the United States Investment Company Act of 1940 pursuant to the exemption provided by Section 3(c)(7) thereof, and investors will not be entitled to the benefits of that Act.
This Document is not a 'prospectus', 'product disclosure statement' or other 'disclosure document' for the purposes of the Corporations Act 2001 (Cth) ("Australian Corporations Act") and is not required to be lodged with the Australian Securities and Investments Commission ("ASIC") or the Australian Securities Exchange ("ASX"). Accordingly, a person may not (directly or indirectly) offer for subscription or purchase or issue invitations to subscribe for or buy or sell the Ordinary Shares, or distribute this admission document where such offer, issue or distribution is received by a person in the Commonwealth of Australia, its territories or possessions, except if:
- the amount payable by the transferee in relation to the Ordinary Shares is A$500,000 or more or if the offer or invitation to the transferee is otherwise an offer or invitation that does not require disclosure to investors in accordance with part 6D.2 or part 7.9 of the Corporations Act; or
- the offer or invitation does not constitute an offer to a 'retail client' under Chapter 7 of the Corporations Act.
The distribution of this Document in or into jurisdictions other than the United Kingdom may be restricted by law and therefore persons into whose possession this Document comes should inform themselves about and observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.
None of the Ordinary Shares have been approved or disapproved by the Securities and Exchange Commission ("SEC"), any state securities commission in the United States or any other regulatory authority in the United States, nor have any of the foregoing authorities passed comment upon or endorsed the merit of the offer of the Ordinary Shares or the accuracy or the adequacy of this Document. Any representation to the contrary is a criminal offence in the United States.
Application will be made for the New Ordinary Shares to be admitted to the Equity Shares (transition) category of the Official List.
It should be noted that the FCA will not have authority to (and will not) monitor the Company's compliance with any of the Listing Rules which the Company has indicated herein that it intends to comply with on a voluntary basis, nor to impose sanctions in respect of any failure by the Company to so comply. Certain information in relation to the Company is incorporated by reference into this Document. Capitalised terms used herein have the meanings ascribed to them at the end of this Document under the heading "Definitions".
Notice of General Meeting
The Notice of a General Meeting of the Company, to be held on 19 December 2024 at 10.00 a.m. at 55 Athol Street, Douglas, Isle of Man, IM1 1LA is set out at Part X of this Document. A summary of the action you should take is set out in paragraph 17 of Part I of this Document and in the Form of Proxy that accompanies this Document.
This Document is dated 26 November 2024.
Ax12 (6.1) LR 2.2.3
2
NOTICE TO INVESTORS
The distribution of this Document and the Subscription and Admission may be restricted by law in certain jurisdictions and therefore persons into whose possession this Document comes should inform themselves about and observe any restrictions, including those set out below. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.
No action has been or will be taken in any jurisdiction that would permit a public offering of the Ordinary Shares, or possession or distribution of this Document or any other offering material in any country or jurisdiction where action for that purpose is required. Accordingly, the Ordinary Shares may not be offered or sold, directly or indirectly, and neither this Document nor any other offering material or advertisement in connection with the Ordinary Shares may be distributed or published in or from any country or jurisdiction except under circumstances that will result in compliance with any and all applicable rules and regulations of any such country or jurisdiction. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction. This Document does not constitute an offer to subscribe for any of the Ordinary Shares offered hereby to any person in any jurisdiction to whom it is unlawful to make such offer or solicitation in such jurisdiction.
This Document has been approved by the FCA, as a prospectus which may be used to offer securities to the public for the purposes of section 85 of FSMA and of the Prospectus Regulation. No arrangement has been made with the competent authority in any EEA State (or any other jurisdiction) for the use of this Document as an approved prospectus in such jurisdiction and accordingly no public offer is to be made in any such jurisdiction. Issue or circulation of this Document may be prohibited in countries other than those in relation to which notices are given below. This Document does not constitute an offer to sell, or the solicitation of an offer to subscribe for or buy, shares in any jurisdiction in which such offer or solicitation is unlawful.
This Prospectus has been approved by the FCA, as competent authority under the Prospectus Regulation. The FCA only approves this Prospectus as meeting the standards of completeness, comprehensibility and consistency imposed by the Prospectus Regulation. Such approval should not be considered as an endorsement of the issuer or the quality of the securities that are the subject of this Prospectus. Investors should make their own assessment as to the suitability of investing in the securities.
Ax3 (1.5(a)) Ax12 (1.5(a))
FOR THE ATTENTION OF EUROPEAN ECONOMIC AREA INVESTORS
In relation to each member state of the European Economic Area (each, a "Relevant Member State"), an offer to the public of the Ordinary Shares may only be made once the publication of the Prospectus has been approved by the competent authority in such Relevant Member State or, where appropriate, approved in another Relevant Member State and notified to the competent authority in that Relevant Member State, all in accordance with the EU Prospectus Regulation, except that an offer to the public in that Relevant Member State of any Ordinary Shares may be made at any time under the following exemptions under the EU Prospectus Regulation, subject to Article 3 and Article
23 of the EU Prospectus Regulation:
- to any legal entity which is a qualified investor, within the meaning of article 2(e) of the EU Prospectus Regulation;
- to fewer than 150 natural or legal persons (other than qualified investors within the meaning of article 2(e) of the EU Prospectus Regulation) in such Relevant Member State subject to obtaining prior consent of the Company for any such offer; or
- in any other circumstances falling within Article 1(4) of the EU Prospectus Regulation,
provided that no such offer of Ordinary Shares shall result in a requirement for the publication by the Company of a prospectus pursuant to Article 3 of the EU Prospectus Regulation.
For the purposes of this provision, the expression an "offer to the public" in relation to any offer of Ordinary Shares in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and any Ordinary Shares to be offered so as to enable an investor to decide to purchase or subscribe for the Ordinary Shares and the expression "EU Prospectus Regulation" means Regulation (EU) 2017/1129.
3
FOR THE ATTENTION OF UK INVESTORS
This Document comprises a prospectus relating to the Company prepared in accordance with the Prospectus Regulation Rules and approved by the FCA under section 87A of FSMA. This Document has been filed with the FCA and made available to the public in accordance with Rule 3.2 of the Prospectus Regulation Rules.
No Ordinary Shares have been offered or will be offered to the public in the United Kingdom prior to the publication of this Prospectus in relation to the Ordinary Shares which has been approved by the FCA, except that the Ordinary Shares may be offered to the public in the United Kingdom at any time under the following exemptions under the Prospectus Regulation, subject to Section 85 of FSMA and Article 23 of the Prospectus Regulation:
- to any legal entity which is a qualified investor within the meaning of article 2(e) of the Prospectus Regulation;
- to fewer than 150 natural or legal persons (other than qualified investors within the meaning of article 2(e) of the Prospectus Regulation), subject to obtaining the prior consent of the Company for any such offer; or
- in any other circumstances falling within Section 86 of FSMA.
For the purposes of this provision, the expression an "offer to the public" in relation to any offer of Ordinary Shares in the United Kingdom means the communication in any form and by any means of sufficient information on the terms of the offer and any Ordinary Shares to be offered so as to enable an investor to decide to purchase or subscribe for any Ordinary Shares and the expression "Prospectus Regulation" means the UK version of Regulation (EU) No 2017/1129 which is part of UK law by virtue of the European Union (Withdrawal) Act 2018 ("EUWA").
FOR THE ATTENTION OF US INVESTORS
The Ordinary Shares have not been and will not be registered under the Securities Act, as amended, or the securities laws of any state or jurisdiction of the United States, and may not be offered, sold, resold, transferred or distributed, directly or indirectly, within, into or in the United States, except pursuant to an exemption from, or in a transaction that is not subject to, the registration requirements of the Securities Act and in compliance with the securities laws of any state or jurisdiction of the United States.
Accordingly, the Ordinary Shares may only be sold: (i) within the United States or to US Persons as defined in Regulation S of the Securities Act ("US Persons") (wherever located) in transactions exempt from the registration requirements of the Securities Act and only to persons who are both qualified institutional buyers, as defined in Rule 144A of the Securities Act; and (ii) outside the United States to persons who are non-US Persons in offshore transactions within the meaning of, and in accordance with, Regulation S under the Securities Act.
The Ordinary Shares have not been approved or disapproved by the SEC, any state securities commission in the United States or any other regulatory authority in the United States, nor have any of the foregoing authorities passed comment upon or endorsed the merit of the offer of the Ordinary Shares or the accuracy or the adequacy of this Document. Any representation to the contrary is a criminal offence in the United States.
The Company is not subject to the reporting requirements of section 13 or 15(d) of the US Securities Exchange Act of 1934, as amended (the "US Exchange Act"). For so long as any Ordinary Shares are "restricted securities" within the meaning of Rule 144(a)(3) of the Securities Act, the Company will, during any period in which it is neither subject to section 13 or 15(d) of the US Exchange Act nor exempt from reporting pursuant to Rule 12g3-2(b) thereunder, provide, upon written request, to Shareholders and any owner of a beneficial interest in Ordinary Shares or any prospective purchaser designated by such holder or owner, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act. The Company expects to be exempt from reporting pursuant to Rule 12g3-2(b).
4
FOR THE ATTENTION OF AUSTRALIAN INVESTORS
This document is not a 'prospectus', 'product disclosure statement' or other 'disclosure document' for the purposes of the Australian Corporations Act and is not required to be lodged with ASIC or the ASX. Accordingly, a person may not (directly or indirectly) offer for subscription or purchase or issue invitations to subscribe for or buy or sell the Ordinary Shares, or distribute this admission document where such offer, issue or distribution is received by a person in the Commonwealth of Australia, its territories or possessions, except if you can make the representation below. Confirmation of Your Representation: You represent to the Company that you are either (i) a "sophisticated investor" under section 708(8)(a) or (b) of the Corporations Act 2001 (Cth) (Corporations Act); (ii) a "sophisticated investor" under section 708(8)(c) or (d) of the Corporations Act and that you have provided an accountant's certificate in accordance with section 708(8)(c)(i) or (ii) of the Corporations Act and related regulations before receiving this document ; (iii) a person associated with the Company under section 708(12) of the Corporations Act; or (iv) a "professional investor" within the meaning of section 708(11)(a) or (b) of the Corporations Act.
Restrictions: This document is being furnished in connection with an offering exempt from or not subject to registration or disclosure under the Corporations Act solely for the purpose of enabling a prospective investor to consider the purchase of the Ordinary Shares described in this document. In making an investment decision, investors must rely on their own examination of the merits and risks involved.
The Ordinary Shares have not been and will not be registered under the Corporations Act.
You are reminded that you have accessed this document on the basis that you are a person into whose possession it may be lawfully delivered in accordance with the laws of the jurisdiction in which you are located.
5
CONTENTS | |
PAGE | |
NOTICE TO INVESTORS | 3 |
SUMMARY | 7 |
RISK FACTORS | 15 |
CONSEQUENCES OF LISTING IN THE EQUITY SHARES (TRANSITION) CATEGORY | 25 |
IMPORTANT INFORMATION | 27 |
EXPECTED TIMETABLE OF PRINCIPAL EVENTS | 32 |
ADMISSION STATISTICS | 32 |
DIRECTORS, SECRETARY AND ADVISERS | 33 |
PART I - INFORMATION ON THE COMPANY | 34 |
PART II - DIRECTORS, KEY MANAGEMENT AND CORPORATE GOVERNANCE | 49 |
PART III - THE JULY AND NOVEMBER SUBSCRIPTIONS | 53 |
PART IV - HISTORICAL FINANCIAL INFORMATION OF THE COMPANY | 55 |
PART V - CAPITALISATION AND INDEBTEDNESS AS AT 30 SEPTEMBER 2024 | 58 |
PART VI - TAXATION | 59 |
PART VII - ADDITIONAL INFORMATION | 61 |
PART VIII - DEFINITIONS | 82 |
PART IX - TECHNICAL GLOSSARY | 87 |
PART X - NOTICE OF GENERAL MEETING | 88 |
6
SUMMARY
This summary is made up of four sections and contains all the sections required to be included in a summary for this type of securities and issuer. Even though a sub-section may be required to be inserted in the summary because of the type of securities and issuer, it is possible that no relevant information can be given regarding the sub-section. In this case, a short description of the sub-section is included in the summary with the mention of "not applicable".
Art 7, 3
Art7, 4(a)
Art 7, 5
SECTION A - INTRODUCTION AND WARNINGS
Name and ISIN of the securities
Ticker for the Ordinary Shares: BRES
International Securities Identifier Number (ISIN): GB00BFCMVS34.
Identity and contact details of the issuer
The legal and commercial name of the issuer is Blencowe Resources Plc and its registered address is at 167-169 Great Portland Street, 5th Floor, London W1W 5PF.
The Company's Legal Entity Identifier (LEI) is: 213800UX1HBIRK36GG11.
Identity and contact details of the competent authority approving the prospectus
The competent authority approving the Prospectus is the Financial Conduct Authority whose registered address is at 12 Endeavour Square, London E20 1JN, United Kingdom and telephone number is +44 (0)20 7066 1000.
Date of approval of the prospectus
LR 2.2.10(2)(a)
The Prospectus was approved on 26 November 2024.
Warnings
This summary should be read as an introduction to this Document. Any decision to invest in the Ordinary Shares should be based on consideration of this Document as a whole by the investor. The investor could lose all or part of the invested capital.
Civil liability attaches only to those persons who have tabled this summary including any translation thereof, but only where the summary is misleading, inaccurate, or inconsistent, when read together with the other parts of the Prospectus, or where it does not provide, when read together with the other parts of the Prospectus, key information in order to aid investors when considering whether to invest in such securities.
SECTION B - KEY INFORMATION ON THE ISSUER
Who is the issuer of the securities?
Domicile and legal form
The Company is a public company limited by shares, incorporated on 18 September 2017 in England and Wales under the Companies Act 2006 (the "Act") with an indefinite life and with company number 10966847 and LEI, 213800UXIHBIRK36GG11.
Principal activities
The Company is developing the Orom-Cross graphite project in Uganda ("Orom-Cross" or the "Project") in Uganda. The Company owns and operates 100 per cent. of the share capital of Consolidated African Resources (Uganda) Ltd ("Consolidated African (Uganda)"). The Company's principal activity through Consolidated African (Uganda) is to develop the Project to produce graphite concentrate. The Company is currently completing a Definitive Feasibility Study ("DFS") prior to completing the project financing and commissioning of the Project.
The Company commenced the DFS in 2023 and on 27 April 2023 announced it had engaged with the US Government backed, Development Finance Corporation ("DFC"), a US Government agency that funds private sector projects to source critical metals, with the DFC to become a strategic funding partner for the Project.
The DFC proposal included providing a Technical Assistance Grant ("TAG") to co-fund certain work for the DFS and to have the right of first refusal to lead the project financing of the Project. On 22 September 2023 the Company announced that it had signed the TAG which provided funding of up to $5,000,000 ("DFC Grant Agreement"). The Company has received a total of $3,500,000 since the initial tranche was received in October 2023. Four tranches of this TAG have been received to date, for US$3,500,000 and the Company anticipates receiving the balance of US$1,500,000 with $500,000 by the end of this year and the balance of $1,000,000 prior to completion of the DFS.
On 6 February 2024 the Company announced a subscription by a specialist African investor to subscribe for 7,847,000 Ordinary Shares at 5 pence per Ordinary Share raising gross proceeds of £392,350. The new investor undertook substantial due diligence on the Project and this was viewed as an initial investment with further
Art 7, 4(b)
Art 7, 6(a)
7
funding to follow as the relationship was built. As at the date of this Document, the investor holds 3.4% of the Existing Share Capital.
On 22 July 2024, the Company announced the completion of a placing and admission to trading of 9,191,520 new Ordinary Shares at 5 pence per Ordinary Share to raise gross proceeds of £459,639. It also announced it had received Subscriptions for 3,181,260 new Ordinary Shares ("July Subscription"), at a price of 5 pence per Ordinary Share conditional on publication of this Document and Admission which will raise gross proceeds of £159,063.
The Company also announced that it had reached agreement with various contractors, consultants, and industrial partners to the Project to issue 25,721,250 new Ordinary Shares ("Fee Shares") at the issue price of 5 pence in lieu of fees accrued and owing by the Company. The Company will issue 20,030,000 ordinary shares on Admission and 3,691,250 ordinary shares subject to Resolutions at the GM. The issue of the Fee Shares has saved the Company expending cash of £1,286,062 with regard to key aspects of the DFS programme whilst ensuring that are key partners are aligned with the shareholders of the Company.
On 6 November 2024 the Company announced a fundraise of £1,500,000 through the issue of 37,500,000 new Ordinary Shares at 4 pence per share ("Fundraise"). The Fundraise comprises a £1,000,000 placing of 25,000,000 new Ordinary Shares ("Firm Placing") arranged through its broker Tavira Financial ("Tavira") and a conditional £500,000 subscription for 12,500,000 new Ordinary Shares from senior management ("November Subscription"). The November Subscription is subject to the publication of this Document and Admission. The Firm Placing was admitted to trading on 12 November 2024.
On 7 November 2024 the Company announced the results of £117,894.60 through the issue of 2,946,890 Ordinary Shares 12 November 2024.
a Retail Offer through BookBuild to raise which were duly admitted on trading on
The Company is now pursuing an expanded DFS (which entails further resource drilling) targeting completion in H1 2025 and then moving on to complete the project financing and commissioning of the mine in 2026.
Major shareholders
So far as the Company is aware, as at the date of this Document and on Admission, the following persons will have a notifiable, direct or indirect, interest in the Company's share capital or Voting Rights of three per cent.
(3%) or more:
Holding | % Holding | |||||
after | after | |||||
Holding | % Holding | passing of | passing of | |||
Holding | % Holding | on | on | Resolutions | Resolutions | |
Major Shareholder | at LPD | at LPD | Admission | Admission | at GM | at GM |
Pershing Nominees Limited | 49,938,001 | 22.1% | 49,938,001 | 17.1% | 49,938,001 | 16.9% |
Hargreaves Lansdown | ||||||
(Nominees) Limited | 39,400,331 | 17.4% | 39,400,331 | 13.5% | 39,400,331 | 13.3% |
RAB Capital Holdings Ltd | 25,050,000 | 9.8% | 25,050,000 | 8.6% | 25,050,000 | 8.5% |
Interactive Investor Services | ||||||
Nominees Limited | 21,074,839 | 9.3% | 21,074,839 | 7.2% | 21,074,839 | 7.1% |
Jim Nominees Limited | 16,880,615 | 7.5% | 16,880,615 | 5.8% | 16,880,615 | 5.7% |
Vidacos Nominees Limited | 11,140,099 | 4.9% | 11,140,099 | 3.8% | 11,140,099 | 3.8% |
Hsdl Nominees Limited | 8,411,873 | 3.7% | 8,411,873 | 2.9% | 8,411,873 | 2.8% |
There are no differences between the voting rights enjoyed by the above persons and those enjoyed by the other holders of Ordinary Shares.
Controlling Shareholder, if any
The Company is not aware of any person who, either as at the date of this Document or immediately following Admission, exercises, will exercise, or could exercise, directly or indirectly, jointly or severally, control over the Company.
Directors and Key Management
The Directors of the Company are Cameron Pearce, Sam Quinn and Alex Passmore.
Mike Ralston and Iain Wearing are Key Management.
Statutory auditors
Crowe U.K. LLP, 55 Ludgate Hill, London EC4M 7JW which is regulated by the FCA with registration number 400456.
8
What is the key financial information regarding the issuer?
Selected Key Historical Financial Information
Art 7, 6(b)
This Document contains historical financial information on the Company. The tables below set out summary audited financial information on the Company for the years ended 30 September 2023, 2022 and 2021 and unaudited financial information for the six months to 31 March 2024 and 2023.
Prospective investors should review the following selected historical financial information together with the whole of this Document and should not rely on the selected information itself.
Unaudited financial | |||||
information for the | Audited financial information | ||||
6 months to | for the 12 months to | ||||
31 March | 31 March | 30 September | 30 September | 30 September | |
2024 | 2023 | 2023 | 2022 | 2021 | |
Statement of Financial Position | |||||
Total assets | 7,620,428 | 7,332,461 | 7,766,280 | 7,048,094 | 5,442,157 |
Total equity | 5,597,935 | 6,132,098 | 5,871,196 | 5,897,867 | 4,274,526 |
Total liabilities | 2,022,493 | 1,200,363 | 1,895,084 | 1,150,227 | 1,167,631 |
Total equity and liabilities | 7,620,428 | 7,332,461 | 7,766,280 | 5,897,867 | 5,442,157 |
Statement of Comprehensive Income of the Company | |||||
Total Revenue | - | - | - | - | - |
Operating Loss | 706,155 | 463,066 | (1,397,967) | (1,089,679) | (691,064) |
Interest receivable and other income | 64,153 | 7,807 | 31,282 | - | - |
Loss before Taxation | (725,840) | (486,076) | (1,366,685) | (1,089,679) | (691,064) |
Income Tax | - | - | - | - | - |
Loss for the period | (661,687) | (478,269) | (1,366,685) | (1,089,679) | (691,064) |
Total comprehensive income for the | |||||
year attributable to equity owners | (661,687) | (478,269) | (1,366,685) | (1,089,679) | (691,064) |
Brief description of any qualifications in the audit report
The Company's auditor highlighted a material uncertainty related to going concern due to the cash balance being £129,853 as at 30 September 2023 and the Company was therefore dependent on obtaining financing in order to meet its working capital requirements over the following 12 months notwithstanding the DFC Grant of US$5m.
The Company's auditor highlighted a material uncertainty related to going concern as the Company incurred operating losses of £1,089,679 during the year ended 30 September 2022 and was dependent on obtaining financing in order to meet its working capital requirements over the following 12 months.
The Company's auditor highlighted a material uncertainty related to going concern as the Company incurred operating losses of £691,064 during the year ended 30 September 2021 and was dependent on obtaining financing in order to meet its working capital requirements over the following 12 months.
What are the key risks that are specific to the issuer?
Brief description of the most material risk factors specific to the issuer contained in the prospectus.
Working Capital
The Company is of the opinion that, taking into account the existing cash resources of the Company and the Net Proceeds from the July Subscription and November Subscription, the working capital available to the Company is insufficient for its present requirements that is for at least 12 months from the date of this Document ("Working
Capital Period").
The Company had originally budgeted $10m to complete the DFS, however, following recent consultation with the DFC the Company will now pursue a larger mining operation thus requiring additional drilling to build further inventory of mineral resources ("Expanded DFS"). Therefore, as a result of additional drilling forming part of the Expanded DFS the budget for the Expanded DFS has increased to $12m, an increase of $2m (£1.5m) which had been budgeted to complete the DFS. The Company will complete the Expanded DFS for the increased budget of £1.5m in H1 2025. In addition, the Company has also budgeted a further £1m for general working capital. Therefore the Board estimates that the total amount of additional working capital required during the Working Capital Period is £2.5m.
The Company has carefully designed a budget of £2.5m to be financed from a combination of capital raised by the Company and drawing down the next 2 tranches of the TAG from the DFC. The Company will finance the Expanded DFS budget of £1.5m from existing cash resources and Net Proceeds of the July and November Subscription which is approximately £1.6m. The Company estimates that it will have a working capital shortfall of approximately £0.9m and expects to meet the shortfall by drawing down the tranches of TAG from the DFC which amount to $1.5m (£1.1m). The Company expects to receive the next TAG tranche of $0.5m from the DFC before 31 December 2024 and the balance tranche of $1m in H1 2025, in accordance with the tranche milestones set by the DFC.
Art7, 6(c) Art 7, 10
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If the DFC TAG funds are not received, the Company would be required to raise further capital to meet its working capital shortfall of £0.9m. The Company has complete control on the timing of cash expenditures and has no contractual obligations to spend capital on the Expanded DFS. Therefore, if the DFC funds are delayed or are not received, the Company could delay the completion of the Expanded DFS. The DFC has to date provided $3.5m of funding under the DFC Grant Agreement which provides for set tranches of funding to be made available on satisfaction of milestones to be achieved by the Company and the Company are in regular dialogue with the DFC regarding forthcoming grant proceeds and know of no reason why future tranches of the TAG payments will not occur.
Also, if the Company were required to raise further capital, the Board is confident it would receive the support of its shareholders as it has done in several recent fundraisings, so that any delay to the Expanded DFS as a result would be immaterial. In the event that the Company failed to raise further capital, it would be required to delay the completion of the Expanded DFS to preserve cash resources and general working capital which would consequently delay the ability of the Company to commence project finance discussions and ultimately production at Orom-Cross.
Title and Licence Risk- While the Group has investigated its title to, and rights and interests in, the Project Licences making up the Orom-Cross Project, and to the best of its knowledge, such title and interests are in good standing, this should not be construed as a guarantee of the same. Title to the Orom-Cross Project may be subject to undetected defects. If a defect does exist it is possible that the Group may lose all or part of its interest in the Orom-Cross Project. On 6 September 2023 Consolidated African (Uganda) submitted an application to the Directorate of Geological Survey and Mines for the renewal of the Exploration Licences. Whilst Consolidated African (Uganda) has not received confirmation of the renewal of any or all of the Exploration Licences, all of the conditions required for the renewal of the Exploration Licences have been satisfied in accordance with the provisions of the Mining Act and the Directors know of no reason that would prevent any or all of the Exploration Licences being renewed. However, Consolidated African (Uganda) cannot state with any certainty when any or all of the Exploration Licences will be renewed. If the remainder of the Exploration Licences were not renewed, the Company may not be able to further expand the Orom-Cross Project.
DFS Risk- Only a portion of the Orom-Cross Project has been explored to date. The Group prepared a Preliminary Economic Assessment ("PEA") of the Orom-Cross Project which was published in October 2021 and which was the first full commercial study of the Orom-Cross Project. However, the PEA was an internally generated report and model that utilised the information, source data and experience within the Company to put together a full mining operation and the associated outcomes. The Company completed a more detailed Pre-Feasibility Study ("PFS") in July 2022, which outlined the commercial viability of the mining operation at Orom-Cross, and formed the basis for the final Definitive Feasibility Study in 2023. The Company commenced the DFS programme in 2023, which programme may change, be delayed and cost more than budgeted, which would delay the ability of the Company to progress to the project financing and ultimately the construction of the mine. Any unforeseen time or cost overruns may require the Company to raise further capital and dilute current shareholders.
Revenue Generation- The development and success of the Project will be primarily dependent on the future prices of graphite and the demand for graphite. The graphite prices are subject to significant fluctuation and are affected by a number of factors which are beyond the control of the Company. Such factors include, but are not limited to exchange rates, fluctuations in the value of the United States dollar and foreign currencies, global and regional supply and demand, and political and economic conditions. The price of graphite and other commodities have fluctuated widely in recent years, and future price declines could cause any future development of and commercial production from the Group's property to be impracticable for the foreseeable future.
Financing- The Company is likely to remain cash flow negative for some time and, although the Directors have confidence in the future revenue earning potential of the Group from its interests in the Orom-Cross Project, there can be no certainty that the Group will achieve or sustain revenue, profitability or positive cash flow from its operating activities. The Expanded DFS programme is anticipated to cost approximately US$12m and shall be funded by the Company and the DFC. The Company will need to raise further capital outside of the Working Capital Period until such time that it has commenced generating cash from mining operations.
Country Risk- the Project is located in Uganda and the Company's activities may be affected in varying degrees by political stability and governmental regulations. Any changes in regulations or shifts in political attitudes in Uganda or any other countries in which the Group may operate are beyond the control of the Group and may adversely affect its operations. The Company will be seeking to complete the project financing of the Project in the foreseeable future, therefore any adverse country risk may be detrimental to the ability of the Company to raise such funds and fully develop the mine.
Exploration and Development activities- Mineral exploration and development involve a high degree of risk. Many licences which are explored ultimately fail to be developed into producing mines. Success in defining mineral resources and reserves is the result of a number of factors, including the level of geological and technical expertise, the quality of land available for exploration and other factors. Once mineralisation is discovered, it may take several years of drilling and development until production is possible during which time the economic feasibility of production may change.
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