Tungsten West PLC Corporate Update (4280J)

TIDMTUN

RNS Number : 4280J

Tungsten West PLC

16 August 2023

16 August 2023

Tungsten West Plc

("Tungsten West", the "Company" or the "Group")

Corporate Update

Tungsten West (LON:TUN), the mining company focused on restarting production at the Hemerdon tungsten and tin mine ("Hemerdon" or the "Project") in Devon, UK, is pleased to announce that it has fulfilled the conditions precedent to draw the second tranche of up to GBP2.975 million of the 2023 Convertible Loan Notes ("CLNs"), announced on 19 May 2023.

In May 2023, the Company confirmed that it had raised a total of up to GBP6.95 million (before expenses) by way of CLNs, in two tranches, as follows:

-- an initial tranche of GBP3.975 million issued following the satisfaction of the conditions precedent in the Note Purchase Agreement ("Tranche A Notes"). The amount comprised a maximum commitment of up to GBP2 million from funds managed by Lansdowne and up to GBP1.975 million from other note purchasers; and

-- an additional tranche ("Tranche B Notes") of GBP2.975 million (comprising a maximum commitment of GBP1 million from funds managed by Lansdowne and up to GBP1.975 million from the other note purchasers) following the satisfaction of certain conditions precedent with the consent of the majority holders of the CLNs.

Lansdowne has now confirmed that Tungsten West has made satisfactory progress in permitting, funding and governance arrangements and has fulfilled the necessary conditions precedent to draw the Tranche B Notes. The Company expects to issue a further GBP2.975 million of loan notes on or around 17 August 2023.

As previously announced on 13 March 2023, the Board has been actively searching for suitable, industry experienced non-executive directors to enhance the Board's capabilities and to align the Board with the Company's strategic requirements. Further to this search the Board intends to appoint Mr. Adrian Bougourd and Mr. Guy Edwards as non-executive Directors, subject to satisfactory completion of due diligence checks required for the appointment of a director of an AIM company. Further details of these proposed appointments will be announced to the market once this due diligence process has been completed.

Additionally, further to the restructuring exercise and cost reduction programme announced on 3 April 2023, Tungsten West has initiated a further evaluation of the financing structure of the Company, whereby spending priority has been given to activities relating to planning and permitting, environmental compliance and funding, as these are essential to the continued progress of the Project.

Therefore, in order to prioritise these activities, a proposed cost reduction programme will need to be implemented, including a further approximate 25% reduction in staff costs via redundancies, reduced hours and resignations. In line with this, the Company has initiated a collective consultation process with staff and expects to announce the results of this exercise in September 2023. In another move to manage liquidity, the Company is in the process of agreeing deferred payment plans and restructuring supply agreements with a number of creditors.

Neil Gawthorpe, CEO of Tungsten West, commented: "Although the further evaluation of the financing structure of the business has led to some difficult decisions for the Board, the cost savings this will generate, combined with the funds received from the Tranche B Notes, will provide crucial funding for planning and permitting activities, and enable us to ensure continued environmental compliance, which are vital steps towards restarting the Hemerdon mine.

"We will continue to work with all stakeholders, including governmental departments and organisations, and the local community, to ensure all funding and permitting requirements are in place to recommence the production of tungsten and tin at Hemerdon as soon as practicable."

This announcement contains inside information for the purposes of Article 7 of Regulation 596/2014 as amended by the Market Abuse (Amendment) (EU Exit) Regulations 2019.

Ends

For further information, please contact:

Enquiries

 
   Tungsten West                        Strand Hanson 
    Neil Gawthorpe                       (Nominated Adviser and Financial 
    Tel: [phone]             Adviser) 
                                         James Spinney / James Dance / 
                                         Abigail Wennington 
                                         Tel: [phone] 
   BlytheRay                            VSA Capital Limited 
    (Financial PR)                       (Financial Adviser and Joint 
    Tim Blythe / Megan Ray               Broker) 
    Tel: [phone]             Andrew Raca / Andrew Monk 
    Email: [e-mail]    Tel: [phone] 
 
    Hannam & Partners 
    (Joint Broker) 
    Andrew Chubb / Matt Hasson / 
    Jay Ashfield 
    Tel: [phone] 
 

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August 16, 2023 02:00 ET (06:00 GMT)