Sula Iron & Gold PLC Placing to raise approximately £0.5 million gross (3314Z)

TIDMSULA

RNS Number : 3314Z

Sula Iron & Gold PLC

14 March 2017

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A BREACH OF THE RELEVANT SECURITIES LAWS OF SUCH JURISDICTION.

This announcement does not constitute a prospectus or offering memorandum or an offer in respect of any securities and is not intended to provide the basis for any investment decision in respect of Sula Iron & Gold Plc or other evaluation of any securities of Sula Iron & Gold Plc or any other entity and should not be considered as a recommendation that any investor should subscribe for or purchase any such securities.

14 March 2017

Sula Iron & Gold plc

("Sula" or the "Company")

Placing to raise approximately GBP0.5 million gross

Sula (AIM: SULA), the gold exploration company focused on Sierra Leone, is pleased to announce that it has conditionally raised approximately GBP0.5 million (before expenses) through a placing by VSA Capital Limited and Madini for, in aggregate, 128,594,765 new ordinary shares of 0.1p each in the Company ("Ordinary Shares") (the "New Ordinary Shares") at an issue price of 0.40p per share (the "Issue Price") (the "Placing").

The Issue Price represents a discount of approximately 13.0 per cent. to the Company's closing middle market share price of 0.46p on 13 March 2017.

The Placing has been targeted at a small number of investors, including two existing shareholders and a strategic long-term investor from Asia, who are seeking to support the growth of the Company as it continues to de-risk and develop the Ferensola Project.

Use of Proceeds

The net proceeds of the Placing will primarily be used:

-- to extend ongoing diamond drilling at Sula's Ferensola gold project both at Sula's high conviction Eastern Target and at Sanama Hill, which already hosts a JORC Compliant Exploration Target of 5-7Mt at a grade of between 4.0-8.0g/t for between 0.8-1.5Moz of contained gold;

-- to assess potential drilling of Sula's 4.5km of strong Induced Polarisation ("IP") anomalies beyond the current drill programme;

   --     for other potential regional exploration programmes; and 
   --     for general working capital purposes. 

Details of the Placing

The New Ordinary Shares have been issued conditional upon their admission to trading on AIM ("Admission"). The Company has made application for Admission of the New Ordinary Shares and it is expected that Admission will become effective and that dealings in the New Ordinary Shares will commence at 8.00 a.m. on 17 March 2017. The New Ordinary Shares represent, in aggregate, approximately 5.8 per cent. of the Company's share capital as enlarged by the Placing (the "Enlarged Share Capital").

The New Ordinary Shares will rank pari passu in all respects with the Company's existing Ordinary Shares and will be issued fully paid.

Following completion of the Placing, the Company's Enlarged Share Capital will comprise 2,214,695,198 Ordinary Shares. This figure may be used by shareholders as the denominator for the calculations by which they may determine if they are required to notify their interest in, or a change to their interest in, the Company under the Financial Conduct Authority's Disclosure and Transparency Rules.

Roger Murphy, Chief Executive Officer of Sula, commented:

"We are delighted to welcome a new strategic long-term investor from Asia, seeking to support the Company as it continues to grow. It is also pleasing that two existing long-term investors have increased their interests in the Company at a 90 per cent. premium to their previous investment. The Board believes that this Placing is a particularly strong endorsement of the Company's strategy at Ferensola. With two drill rigs and associated equipment now on-site and drilling at the Ferensola Project under way, the Company is in a strong position to expand on its originally planned exploration programme of 2,400m, potentially enabling a larger JORC Exploration Target to be identified"

For further information, please visit www.sulaironandgold.com or contact:

 
 Sula Iron & Gold plc                 [phone] 
  Roger Murphy, CEO                    8304 
 VSA Capital Limited (Financial 
  Adviser and Corporate Broker) 
  Andrew Monk 
  Andrew Raca                         [phone] 
  Justin McKeegan                      5000 
 Strand Hanson Limited (Financial 
  and Nominated Adviser) 
  James Harris 
  Matthew Chandler                    [phone] 
  James Dance                          3494 
 Ongeza Mining (Technical Adviser) 
  Iain Macpherson                     [phone] 
  Ilja Graulich                        0629 
 

The information contained within this announcement is deemed by the Company to constitute inside information under the Market Abuse Regulation (EU) No. 596/2014.

This information is provided by RNS

The company news service from the London Stock Exchange

END

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March 14, 2017 03:00 ET (07:00 GMT)