30 March 2010
IM00B61FM981
CENTRAL ASIAN MINERALS AND RESOURCES PLC
("CAMAR" or the "Company")
APPLICATION FOR ADMISSION TO PLUS
The Directors of Central Asian Minerals and Resources PLC are pleased to
announce that they have today applied for the entire issued ordinary share
capital of the Company to be admitted to trading on the PLUS-quoted market.
PROFILE
CAMAR is an Investment Vehicle whose purpose is to identify investment
opportunities within the minerals and resources sector, principally within the
developing countries of central Asia. The intention of the Directors is to
target investments that would give the Company access to significant mineral
deposits, whether proven or inferred, that could eventually be profitably
extracted. The Directors anticipate that precious metals and in particular gold
will be the principal minerals upon which the Company will focus.
In order to preserve the Company's cash resources, CAMAR initially intends to
acquire stakes in target companies in return for the provision of the services,
expertise and advice of its Directors. It is anticipated that pursuant to
contracts for the provision of such services, the Company will receive fees and
will secure a carried interest or other equity interest in the company or
project to which the service is provided.
LISTING INFORMATION
Type of Issue: Introduction
Par Value: Ordinary Shares of no par value each
Number of Ordinary Shares in issue at Admission: 2,333,333
Market capitalisation at 55p per share: GBP1,283,333
ISIN Number: IM00B61FM981
Sector classification: Investment Vehicle
Expected Admission and start of dealings on PLUS: 8.00 a.m. on 15 April 2010
Corporate Adviser: St Helens Capital Partners LLP
INTRODUCTION
CAMAR was incorporated on 2 October 2007 in the Isle of Man and re-registered
under the 2006 Act on 24 June 2009 under the name Central Asian Minerals and
Resources Limited. On 18 December 2009, the Company's name was changed to
Central Asian Minerals and Resources PLC. The Company's purpose is to identify
investment opportunities within the minerals and resources sector, principally
within the developing countries of central Asia.
The Company is deemed to be an Investment Vehicle under the PLUS Rules, which
is defined as "an issuer whose actual or intended principal activity is to
invest in the securities of other businesses (whether publicly traded or not),
or to acquire a particular business, in accordance with specific investment
criteria". Accordingly, in implementing the investment strategy set out below,
any substantial acquisition or investment by the Company is likely to be a
Reverse Takeover and will therefore be subject to, inter alia, Shareholders'
approval.
The Company's objective is to achieve substantial capital growth for
Shareholders through the creation of a significant company in the mining
sector. Prospective shareholders should be aware that any investment in the
Company should be made on a long term basis in order to obtain the benefits of
the Company's strategy.
INVESTMENT STRATEGY
The primary focus of the Company will be to acquire stakes or otherwise to
invest in companies with exploration and/or extraction rights over mineral
resources located in central Asia. The intention of the Directors is to target
investments that would give the Company access to significant mineral deposits,
whether proven or inferred, that could eventually be profitably extracted. The
Directors anticipate that precious metals and in particular gold will be the
principal minerals upon which the Company will focus.
In order to preserve the Company's cash resources, CAMAR initially intends to
acquire stakes in target companies in return for the provision of the services,
expertise and advice of its Directors. It is anticipated that pursuant to
contracts for the provision of such services, the Company will receive fees and
will secure a carried interest or other equity interest in the company or
project to which the service is provided.
By structuring its activities in this way, the Company will be able to maintain
its cash resources so that it is able to fund part of any cash consideration
that may be required in due course to effect an acquisition or to provide
working capital for a target entity. The Company's cash resources may also be
used to meet the costs of preparing a JORC compliant or equivalent standard
report on the resources over which the investee company has secured exploration
rights or to fund the development of an area over which exploration or mining
rights are held.
In pursuit of its Investment Strategy, the Company entered into the Gulf
Agreement on 20 February 2010, pursuant to which CAMAR has agreed to provide
the services of two of its Directors in order to protect and develop Gulf's
interest in the joint venture mining company, Aprelevka, which is licensed to
operate a gold mine in Tajikistan. The agreement provides for CAMAR to receive
fees in respect of the services of its Directors and CAMAR also has an option
to acquire a shareholding of up to 5% in Gulf. Further information about the
Gulf Agreement is set out below.
The Executive Directors believe that their collective experience, together with
their network of contacts, will assist them in the identification, evaluation
and funding of appropriate investment opportunities. When necessary, other
external professionals will be engaged to assist in the due diligence on
prospective targets and their management teams. The Directors will also
consider appointing additional directors with relevant experience, if
appropriate.
The Directors expect to have made an investment or to have completed an
acquisition within six months of Admission. If, for any reason, the Company
fails to make any such investment or acquisition within 12 months of Admission,
the Directors will convene a general meeting of the Company, at which
Shareholders will be given the opportunity to consider the future strategy and
direction of the Company and the most appropriate use of Shareholders' funds.
As at 31 January 2010, the Company had cash resources of GBP323,000. The cash
resources and will be used to meet the annual running costs of the Company. If
the Directors consider that further funds are required, whether in connection
with an acquisition or the development of an area over which exploration or
mining rights are held or otherwise, they may seek to raise such funds by way
of equity from new and/or existing Shareholders or through project finance or
debt.
THE GULF AGREEMENT
As referred to above, on 20 February 2010, the Company entered into an
agreement with Gulf, which, together with Altin-Topkan, is the joint owner of
Aprelevka, a mining company which is licensed to operate and is currently
operating the Aprelevka gold mine in Tajikistan. Pursuant to the agreement with
Gulf, CAMAR will provide the services of Anthony Ehlers and Christine Melian,
both of whom are Directors of the Company, in order to protect and further
Gulf's interest in the jointly-owned company and in that company's licence to
operate the Aprelevka mine. The Directors believe that Gulf is not currently
in a position to perform this task for itself, as it is primarily focused on a
re-financing exercise and is concerned that without adequate representation its
interest in the Aprelevka project may not be realised. The Gulf Agreement
provides for CAMAR to receive a fee of USD 25,000 per month in respect of the
services of Anthony Ehlers and Christine Melian and also grants CAMAR an option
to acquire a shareholding of up to 5 per cent in Gulf for a consideration of
USD 1.0 million. By exercising this option, CAMAR would obtain an indirect
interest in the licence to operate the Aprelevka gold mine.
Whilst assessing the investment potential of the Aprelevka mine, CAMAR
identified certain mining equipment already located in Tajikistan but owned by
a third party, White Poplar, which the Directors believe may be of considerable
value to Gulf as a part of its contribution to the Aprelevka joint venture and
would thus assist CAMAR in fulfilling its obligations under the Gulf Agreement.
For the reasons stated above, Gulf is not currently in a position to acquire
these assets itself. CAMAR has therefore secured the equipment, for Gulf's
eventual use, by acquiring the equipment from White Poplar pursuant to a
contract dated 26 March 2010. In consideration of this acquisition, CAMAR
issued 750,000 Ordinary Shares direct to the shareholders of White Poplar, as
requested by White Poplar. On 30 March 2010, CAMAR entered into an agreement
with Gulf pursuant to which Gulf will pay a specified daily rate to CAMAR for
the use of the equipment now owned by CAMAR as and when it is used in the
Aprelevka mining project.
Following completion of the acquisition of assets from White Poplar, it is
proposed that that company will be dissolved.
REASONS FOR ADMISSION
The Directors believe that Admission will offer the following benefits:
* availability of publicly traded shares - the Directors believe the issue
of publicly traded shares as consideration for any acquisition will be
more attractive to potential vendors than shares in a company which are
not traded on an investment exchange;
* future capital requirements - the Directors believe that Admission will
enable the Company to access capital at later dates more effectively than
if it were an unquoted company;
* increased corporate profile - the Directors believe that the status of
being a company whose shares are traded publicly could benefit any
businesses to be acquired by increasing their profile; and
* incentivisation of key staff - the opportunity to own and retain shares
and incentivise staff through the use of share options in respect of
publicly traded shares.
DIRECTORS
On Admission, the Board will comprise three Directors, brief details of whom
are summarised below:
ANTHONY (TONY) EHLERS, Chief Executive Officer (aged 60)
Tony Ehlers, from South Africa, is a senior mining executive with experience in
mining gold in Tajikistan in Central Asia. In addition to management and
corporate competences, Tony is skilled in production, mine planning,
optimization and design for both open-pit and underground types of operations.
After completing his diploma in Mining at the Witwatersrand Technicon (SA),
Tony trained further and gained experience at the Anglovaal Group, the Chamber
of Mines of South Africa and Minroc Mining Contractors. He started working as
a Senior Mining Consultant at Johnson-Harvey International in 1994, delivering
over 30% measureable and sustainable production improvements on projects in
South Africa, Tanzania, Tajikistan and Zambia. He was General Manager in charge
of re-establishing an underground gold mine in West Africa in 2003. By 2004,
he achieved the status of Chief Operating Officer and General Manager of the
Aprelevka mine in Northern Tajikistan, where he focused on managing costs and
implementing a re-engineering nationalisation programme during a period of
financial duress. He left Aprelevka in 2006 and worked as Operations Manager
for Prominvestors Group in Georgia. In 2007 he became Chief Operating Officer
of Tamaya Resources in Armenia and Portugal, where, amongst other things, he
set up a mine in Southern Armenia.
Tony speaks several languages, is computer literate in a wide variety of
specialised software for mine planning, building and management and holds a
Certificate of Competency from the South African Mine Managers' Association.
CHRISTINE MELIAN, Finance Director (aged 47)
Christine is a financial consultant with over 17 years experience in the
overseas banking and finance industry. In this time, she has led strategic
projects at Credit Suisse in asset reporting and asset management as well as
custody and investment banking trading and clearing processes and directed
divisions of investment companies.
Her previous employers include Credit Suisse, Merck & Co. Inc., BT&T Asset
Management AG in Zurich, and Interactive Investor International plc, London.
In 2000, Christine founded FTDM, which specialises in strategic consulting,
financial engineering, hedge funds and private equity. Her clients include
Credit Suisse, the Directorate of Finances of Canton of Zurich and a number of
private investors and investment consulting firms. Christine holds degrees from
Switzerland and the US in finance and modern languages.
JOHN LEECH, Non-executive Director (aged 44)
John graduated from the University of Lancaster in Accounting and Finance and
trained as a Chartered Accountant with Coopers & Lybrand in the Isle of Man. He
is now a Fellow of the Institute of Chartered Accountants in England & Wales.
John has over 20 years experience in the offshore finance industry, 17 of which
have been spent in the fiduciary services sector. He is a founding director of
Cavendish Trust Company Limited, Licensed by the Isle of Man Financial
Supervision Commission as a Corporate and Trust Service Provider.
RISK FACTORS
IN ADDITION TO ALL OTHER INFORMATION SET OUT IN THE ADMISSION DOCUMENT, THE
FOLLOWING SPECIFIC FACTORS SHOULD BE CONSIDERED CAREFULLY IN EVALUATING WHETHER
TO MAKE AN INVESTMENT IN THE COMPANY. IF YOU ARE IN ANY DOUBT ABOUT THE ACTION
YOU SHOULD TAKE, YOU SHOULD CONSULT A PERSONAL ADVISER AUTHORISED UNDER THE
FSMA WHO SPECIALISES IN ADVISING ON THE ACQUISITION OF SHARES AND OTHER
SECURITIES PRIOR TO MAKING ANY INVESTMENT.
THE DIRECTORS BELIEVE THE FOLLOWING RISKS TO BE THE MOST SIGNIFICANT FOR
POTENTIAL INVESTORS. HOWEVER, THE RISKS LISTED DO NOT NECESSARILY COMPRISE ALL
THOSE ASSOCIATED WITH AN INVESTMENT IN THE COMPANY. IN PARTICULAR, THE
COMPANY'S PERFORMANCE MAY BE AFFECTED BY CHANGES IN MARKET OR ECONOMIC
CONDITIONS AND IN LEGAL, REGULATORY AND TAX REQUIREMENTS.
IF ANY OF THE FOLLOWING RISKS WERE TO MATERIALISE, THE COMPANY'S BUSINESS,
FINANCIAL CONDITIONS, RESULTS OR FUTURE OPERATIONS COULD BE MATERIALLY
ADVERSELY AFFECTED. ADDITIONAL RISKS AND UNCERTAINTIES NOT PRESENTLY KNOWN TO
THE DIRECTORS, OR WHICH THE DIRECTORS CURRENTLY DEEM IMMATERIAL MAY ALSO HAVE
AN ADVERSE EFFECT UPON THE COMPANY.
THE LIST BELOW IS NOT EXHAUSTIVE, NOR IS IT AN EXPLANATION OF ALL THE RISK
FACTORS INVOLVED IN INVESTING IN THE COMPANY AND NOR ARE THE RISKS SET OUT IN
ANY ORDER OF PRIORITY.
ACQUISITIONS
The success of the Company's strategy is dependent on the management's ability
to identity suitable acquisition targets and to negotiate acceptable commercial
terms for those acquisitions. In the event that the management are not able to
identify and negotiate suitable acquisitions, investors may not achieve a
return on their investment in the Company and their initial investment may be
lost.
ADDITIONAL FINANCING
Acquisitions, mineral exploration and extraction will all require the Company
to raise additional funding. The only sources of funding currently available to
the Company would be from the issue of new shares or from entry into project
finance or other debt facilities. There can be no certainty that such
additional funding will be available to the Company on acceptable commercial
terms or at all.
MINERAL DEPOSITS
Test drilling is required in order to confirm the presence and establish the
potential reserves of valuable minerals. Whilst efforts are made to target such
test drilling, it is by nature a speculative activity and as a consequence may
not ultimately result in revenue being generated by the Company.
Once mining operations have commenced the quality of the minerals extracted may
prove to be lower than anticipated or unforeseen mining difficulties may be
encountered, each of which might cause the continued extraction of the minerals
to become commercially unviable.
MANAGEMENT OF THE MINING OPERATION
The success of mining operations is dependent on the ability and the integrity
of the of the site management team. If inappropriate staff are inadvertently
employed the Company may suffer loss which could adversely impact the value of
an investment in the Company.
EXPLORATION, MINING AND PROCESSING LICENCES
Any mining or exploration company that CAMAR may invest in will be dependent
upon the grant of appropriate licences, concessions, leases, permits and
regulatory consents which may be withdrawn or made subject to limitations.
There is no guarantee that upon completion of exploration a mining licence will
be granted with respect to exploration territory. There can also be no
assurance that any exploration licence will be renewed once it has expired, or
of the terms on which it is renewed.
DEVELOPMENT PROJECTS
In the case that investments are made in development projects, estimates of
proven or probable reserves are largely based upon interpretation of geological
data and drill sampling. Operating costs are estimated on feasibility studies,
and other factors are similarly based on estimates. As a result economic
benefits can differ widely from expectations.
PRECIOUS METAL AND BASE METAL PRICES
The market price of metals is volatile beyond the Company's control and may
adversely affect the feasibility or future profitability of such investments
that the Company may make. The stability of exchange rates can all cause
significant fluctuations in operating costs. Both of these may dramatically
impact on the valuation of any mining investment.
POLITICAL RISK
The Company is proposing to make the Central Asian countries the focus of its
investment activities. There can be no guarantee of the future political and
economic conditions in these countries. The governments of these countries may
enact policy changes concerning taxation, employment law, exchange rates,
environmental protection, repatriation of income, all of which may affect any
investments the Company might have made, or the probability of its being able
to make any profitable investments in those countries.
KEY PERSONNEL
The Company relies on a limited number of key executives. However, there is no
certainty that the Company will be able to retain such key executives. If such
personnel do not remain active in the Company's business, there is the
possibility that the Company would be adversely affected.
TRADING AND LIQUIDITY IN THE ORDINARY SHARES AND PLUS
An investment in the Ordinary Shares is highly speculative and subject to a
high degree of risk. The price of publicly quoted securities can be volatile
and is dependent upon a number of factors, some of which are general market or
sector specific and others that are specific to the Company. Only those who can
bear the risk of the loss of their entire investment should invest.
Application has been made for the Ordinary Shares to be traded on PLUS. PLUS is
a market designed primarily for emerging or smaller companies. The Ordinary
Shares will not be quoted on the Official List. The PLUS Rules are less
demanding than those of the Official List. Investments in shares admitted to
PLUS carry a higher degree of risk than investments in shares quoted on the
Official List. Neither PLUS Markets nor the UK Listing Authority have approved
the Admission Document for the purposes of the Admission.
Notwithstanding the fact that an application will be made for the Ordinary
Shares to be traded on PLUS, this should not be taken as implying that there
will be a "liquid" market in the Ordinary Shares particularly as, on Admission,
the Company will have a limited number of Shareholders. An investment in the
Ordinary Shares may therefore be difficult to realise. In addition, the price
at which the Ordinary Shares will be traded and the price at which investors
may realise their investment will be influenced by a large number of factors,
some specific to CAMAR and its operations and some which may affect quoted
companies generally.
The market for shares in smaller public companies, such as CAMAR, is less
liquid than for larger public companies. CAMAR is aiming to achieve capital
growth and, therefore, Ordinary Shares may not be suitable as a short-term
investment; prospective investors should not consider such purchase unless they
are certain they will not have to liquidate their investment for an indefinite
period of time. The share price may be subject to greater fluctuation on small
volumes of shares, and thus the Ordinary Shares may be difficult to sell at a
particular price. The value of the Ordinary Shares may go down as well as up.
The market price of the Ordinary Shares may not reflect the underlying value of
the CAMAR's net assets. Investors may therefore realise less than their
original investment or sustain a total loss of their investment.
FORCE MAJEURE
CAMAR's operations now or in the future may be adversely affected by risks
outside the control or anticipation of CAMAR including labour unrest, civil
disorder, war, subversive activities or sabotage, fires, floods, explosions or
other catastrophes, epidemics or quarantine restrictions.
Contact Information
CENTRAL ASIAN MINERALS AND RESOURCES PLC +44 1624 679 000
Christine Melian or John Leech
ST HELENS CAPITAL PARTNERS LLP +44 20 7368 6959
Mark Anwyl or Duncan Vasey
The Directors of CAMAR are responsible for the contents of this announcement.
The following definitions apply throughout this announcement, unless the
context requires otherwise:
"2006 Act" the Isle of Man Companies Act 2006, as amended
"Admission" the admission of the issued and to be issued ordinary share
capital of the Company to trading on PLUS becoming effective
in accordance with the PLUS Rules
"Altin-Topkan" The Altin-Topkan Mining Management, a legal entity registered
in accordance with the legislation of the Republic of
Tajikistan
"Aprelevka" the Joint Tajik-Canadian Limited Liability Company
"Aprelevka"
"Board" or the directors of the Company, whose names are set out on page
"Directors" 7 of this Document
"Company" or Central Asian Minerals and Resources PLC
"CAMAR"
"Document" the Admission Document of the Company dated 30 March 2010
"FSA" the Financial Services Authority
"FSMA" the Financial Services and Markets Act 2000, as amended
"Gulf the agreement dated 20 February 2010 between CAMAR (1) and
Agreement" Gulf (2) under which CAMAR has agreed to provide the services
of two of its Directors to Gulf
"Gulf" Gulf International Minerals Ltd, a corporation continued into
British Columbia under the Business Corporations Act (British
Columbia)
"Investment the investment strategy of the Company as described in the
Strategy" section headed "Investment Strategy" in Part I of the
Document
"Investment an issuer whose actual or intended principal activity is to
Vehicle" invest in the securities of other businesses (whether
publicly traded or not), or to acquire a particular business,
in accordance with specific investment criteria
"Issued Share the issued ordinary share capital of the Company immediately
Capital" following Admission
"JORC" Joint Ore Resources Committee
"Official List" the Official List of the UK Listing Authority
"Ordinary ordinary shares of no par value each in the capital of the
Shares" Company
"PLUS" or the primary market for unlisted securities operated by PLUS
"PLUS-quoted Markets plc
Market"
"PLUS Markets" PLUS Markets plc, a recognised investment exchange under
section 290 of FSMA, which is a subsidiary of PLUS Markets
Group plc
"PLUS Rules" the rules for the regulation of the PLUS-quoted Market
published by PLUS Markets PLC governing companies whose
shares are admitted to trading on PLUS or which seek to be
admitted as such
"Reverse an acquisition by the Company which constitutes a reverse
Takeover" takeover for the purposes of the PLUS Rules
"Shareholders" the persons who are registered as the holders of Ordinary
Shares from time to time
"St Helens St Helens Capital Partners LLP, PLUS Corporate Adviser to the
Capital" Company, which is authorised and regulated by the FSA
"UK" the United Kingdom of Great Britain and Northern Ireland
"USD" or "$" United States Dollars, the currency of the United States of
America
"White Poplar" a company registered in the British Virgin Islands with
registered number 676806
"White Poplar the agreement dated 26 March 2010 between CAMAR (1) and White
Agreement" Poplar (2) regarding the sale and purchase of mineral
exploration drilling equipment
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