Kavango Resources plc said it had entered an exclusive three-month option to acquire the majority share of the nickel-copper-platinum group elements Molopo Farms Complex project in Botswana.
BUSINESS PARTNERS
In an all-share transaction Kavango would acquire 85.23% of Kalahari Key Mineral Exploration Proprietary Ltd (KKME) which owns prospecting licences PL310/2016, PL311/2016 and PL202/2018 at Molopo.
Power Metal Resources plc has a 40% direct interest in Molopo, which it will exchange for a 40% share in the restructured KKME.
Kavango added that following the proposed acquisition, it would hold up to 51.15% in KKME and Evrima plc (shareholder in KKME) would have up to 9.26% of KKME.
The transaction will be for up to £1.875m (payable in stock) with the company issuing 21,307,500 shares, pro-rated, to certain KKME shareholders at an issue price of 5.5p, valuing KKME at £1.375m.
Power Metal chief executive Paul Johnson said it had been clear for some time that the ownership structure of KKME needed to be streamlined alongside increased operational efficiency in Botswana.
| Kavango Resources | 51.15% |
| Power Metal Resources | 40.00% |
| Evrima Plc | 8.85% |
WORK PROGRAMME
Kavango would be the operator and complete a work programme on the 1,723km2 project instead of paying an option fee.
This entails technical due diligence, including fieldwork, and a review of all historical geological and geophysical data before deciding whether to exercise the option.
EXPLORATION
Chief executive Ben Turney added that Kavango’s business model was based on making multiple, large-scale metal discoveries to sell to major international mining firms.
“Over the course of this year we’ve recruited senior technical staff, deployed the latest technologies into the field, invested heavily in our local operations and significantly increased exploration activity.
“The Kavango team has now put in place a strong foundation, upon which we can confidently grow the company.”
Power Metal and Kavango are also working together on the Kanye Resources joint venture in Botswana.