Anglo African Ag PLC Corporate Update and Issue of Convertible Loan Notes

 
TIDMAAAP 
 
The information contained within this announcement is deemed to constitute 
inside information pursuant to the EU (Withdrawal) Act and amended pursuant to 
Market Abuse (Amended) (EU Exit) Regulations 2019. Upon the publication of this 
announcement, this inside information is now considered to be in the public 
domain. 
 
For immediate release 
 
23 March 2021 
 
                         Anglo African Agriculture plc 
 
                           ("AAA" or the "Company") 
 
 
             Corporate Update and Issue of Convertible Loan Notes 
 
The Company is pleased to provide a progress update on the proposed acquisition 
of the Comarco group of companies (the "Comarco Group"). The Comarco Group is 
based in Mombasa, Kenya and is engaged in port and marine logistics activities 
in East Africa. 
 
Results for the year ended 31 October 2020 
 
The Company earlier today released the Directors' Report and Financial 
Statements for the year ended 31 October 2020 on the London Stock Exchange news 
service. A copy of the announcement can be found on the Company's website ( 
www.aaaplc.com), in the "News and Documents" section. 
 
Comarco business update 
 
Despite the uncertainty created by Covid-related lockdowns and business 
interruptions, the main markets in which Comarco operates have seen a rebound 
in activity compared to the calendar year 2020. 
 
Although the LNG project in Mozambique has already formally commenced, there 
has been a pause caused by Covid and security concerns. The project is expected 
to restart in earnest in July 2021. Comarco Marine Division is making the 
necessary preparations in Mombasa and Mozambique with a number of strategic 
partners to be ready when this happens. In the meantime the management team has 
focused on regional projects and Comarco has secured contracts in the coastal 
waters in and around Kenya, Tanzania, Mozambique and Somalia as well as its 
first contract on Lake Tanganyika. 
 
In the Comarco Port Division delivery of iron ore into the yard for export is 
set to recommence in earnest in early April 2021. Negotiations to secure a 
substantial coal import contract are at an advanced stage.  This will 
substantially boost throughput volumes and the overall performance of the port. 
 
In the meantime Comarco's on-going work with the Fujita Corporation in support 
of the Southern Bypass Road Construction project as well as the 
soon-to-commence Kilindini harbour bridge construction project, will benefit 
both the Marine and Port divisions. 
 
Issue of Convertible Loan Notes 
 
The Company is pleased to announce that it has agreed to issue £603,000 (gross) 
convertible loan notes ("CLNs") by converting existing sums due to creditors 
and also by raising sums from private investors.  The proceeds will be used for 
general working capital purposes and costs associated with the proposed 
acquisition of the Comarco Group. The CLNs will attract interest at a fixed 
rate of 12% compounded annually, are convertible into the Company's ordinary 
shares at a price of 5p and, if converted, will entitle the noteholders to 
receive warrants on a 1:1 basis in respect of ordinary shares that the CLNs 
will be converted into and exercisable at a price of 5p per share for a period 
of one year from issue. If not converted, the notes will be repayable on 23 
March 2023. 
 
Gross cash proceeds of £220,000 will be received from participating private 
investors while the remaining £383,000 will result from settlement of existing 
sums due to creditors by the Company. 
 
Certain directors of the Company have agreed to convert the following sums owed 
to them by the Company in respect of unpaid salaries into CLNs. 
 
The following directors have agreed to convert the following amounts of their 
outstanding director fees  into CLNs on the same basis as the funds secured 
from third party investors: 
 
Matthew Bonner              £ 
                42,000 
 
Robert Scott                £ 
                41,000 
 
David Lenigas               £ 
                53,000 
 
Total                     £ 
                136,000 
 
If the CLNs were converted, they would result in the directors receiving the 
following number of shares and warrants: 
 
Director        Number of     Percentage of Number of 
                shares        issued share  Warrants 
                              capital 
 
Matthew Bonner                    3.8%            840,000 
                      840,000 
 
Robert Scott                      3.7%            820,000 
                      820,000 
 
David Lenigas                     4.8%          1,060,000 
                    1,060,000 
 
Total                             12.4%         2,720,000 
                  2,720,000 
 
VSA Capital Limited, the Financial Adviser and Corporate Broker to the Company, 
and a connected party due to Andrew Monk being a director of both the Company 
and VSA Capital Limited, has agreed to convert £212,000 of its outstanding fees 
into CLNs on the same basis as the funds secured from third party investors. If 
the CLNs were converted, they would result in VSA Capital receiving the 
4,240,000 ordinary shares amounting to 19.3 per cent. of the Company's issued 
share capital, and 4,240,000 warrants. 
 
In addition, the price of warrants attributable to the £250,000 convertible 
loan note issued on 1 October 2018 for a two year term and extended to 30 
September 2021 will be amended for the warrants to be exercisable at a price of 
5p per share, instead of 7p. 
 
The conversion of sums due to creditors and the capital raise demonstrates the 
support the Company has been afforded by private investors as well as its 
directors and creditors. 
 
Transaction funding update 
 
The Company is working with Comarco in order to secure the necessary 
arrangements to provide sufficient working and expansion capital to conclude 
the RTO and put the combined group on a growth path after Admission. 
 
Discussions and due diligences with equity and debt funders are progressing. 
Further announcements will be made once binding agreements are executed. 
 
For further information, please visit www.aaaplc.com or www.comarcogroup.com 
contact the following: 
 
 
Anglo African Agriculture plc 
 
David Lenigas, Non-Executive Chairman              [phone] 
 
Rob Scott, Executive Director                      [phone] 
 
Comarco Group 
Simon Phillips (Chief Executive)                   [phone] 
Charlie Pettifer                                   [phone] 
 
VSA Capital Limited (Financial Adviser and         [phone] 
Corporate Broker) 
 
Andrew Raca, Maciek Szymanski (Corporate Finance) 
Andrew Monk (Corporate Broking) 
 
 
 
END 
 
 

(END) Dow Jones Newswires

March 23, 2021 07:46 ET (11:46 GMT)