Central Rand Gold Limited Placing, Board Changes and appointment of Nomad (0145U)

TIDMCRND

RNS Number : 0145U

Central Rand Gold Limited

19 October 2017

19 October 2017

Central Rand Gold Limited

("Central Rand Gold" or "the Company")

(Incorporated as a company with limited liability under the laws of Guernsey,

Company Number 45108)

(Incorporated as an external company with limited liability under the laws of South Africa,

Registration number 2007/019223/10)

ISIN: GG00B92NXM24

   LSE share code: CRND   JSE share code: CRD 

Firm and Conditional Placing, Board Changes and

Appointment of Nomad

Further to the announcement of 13 October 2017 and the release of the Company's Interim Results yesterday, Central Rand Gold announces that Peterhouse Corporate Finance ("Peterhouse") has raised GBP750,000 before expenses on behalf of the Company through a conditional placing of 1,071,428,566 new ordinary shares of 1p each (the "Placing Shares") at a price of 0.07 pence per share each (the "Placing"). The net proceeds of the Placing will be used for general working capital purposes.

The Placing is conditional, inter alia, on the passing of a relevant resolution at the General Meeting of the Company to be held on 30 October 2017 at the offices of IAG, Regency Court, Glategny Esplanade, St Peter Port, Guernsey, GY1 3RH at 11.00 a.m. (UK time) and the execution of an agreement to effect the conditional disposal of the Company's interest in its immediate subsidiary company, as outlined below.

Trading in the Company's shares will remain suspended pending clarification of the Company's financial position. The Company will update the market in due course.

The Placing Shares, when issued, will rank pari passu in all respects with the Company's existing ordinary shares. Application shall be made for the Placing Shares to be admitted to trading on AIM ("Admission") and it is expected that Admission will become effective and that dealings in the new Ordinary Shares will commence on or around 31 October 2017.

Following completion of the Placing, the new investors will, in aggregate, hold approximately 78.13 per cent. of the enlarged share capital, which following the issue of the Placing Shares will comprise 1,371,261,851 ordinary shares. The Placing Price of 0.07p per share represents a discount of approximately 83.3 per cent. to the closing mid-market price of 0.42p per ordinary share on 11 May 2017, being the date on which trading in the Company's ordinary shares on AIM was suspended.

Following Admission, the Company's enlarged issued share capital will comprise 1,371,261,851 ordinary shares with voting rights. This figure may be used by Shareholders in the Company 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 Guidance and Transparency Rules.

Board Changes

Central Rand Gold is pleased to announce that John Treacy and James Normand have been appointed to the Board of the Company, both as Independent Non-Executive Directors, effective immediately. At the same time, Lola Trollip, Jason Hou and William Zhaung have all resigned from the Board of Central Rand Gold. Jason Hou and William Zhaung will join the Board of Central Rand Gold (Netherland Antilles) N.V. ("CRGNV") to assist in the timely disposal of the operational assets of the Company. Simon Charles will continue to serve on the Board as Independent Non-Executive Chairman. Central Rand Gold would like to thank these directors for their efforts whilst on the Board and would like to wish them all the best with their future endeavours.

John Michael Treacy, Independent Non-Executive Director

Mr Treacy, 36, is an experienced small cap financier who specialises in working with growing companies. He qualified as a solicitor in the London office of a major international law firm where he specialised in Capital Markets and Mergers & Acquisitions. From there he moved to practise corporate finance in the advisory teams of several prominent UK brokerages where he was a Qualified Executive for the purposes of the AIM Rules and acted on numerous IPOs, acquisitions, debt restructurings and placings.

The following information is disclosed pursuant to paragraph (g) of Schedule Two of the AIM Rules for Companies.

 
 Current:   Past: 
 None       China Sports Development 
             Limited 
 

As at the date of this announcement Mr Treacy does not have any interest in any ordinary shares of the Company.

There is no further information to be disclosed in relation to Mr Treacy's appointment pursuant to AIM Rule 17 or paragraph (g) of Schedule Two of the AIM Rules for Companies.

James Patrick Normand, Independent Non-Executive Director

Mr Normand qualified as a Chartered Accountant in 1978, having trained with Spicer and Pegler (now part of Deloitte). Following a secondment (from 1985 to 1987) to 3i plc, Mr Normand specialised for the next 15 years in the provision of advice to management buy-out and buy-in teams and on corporate acquisitions, disposals and capital raisings. Since 2002 Mr Normand has filled management and finance officer roles for a number of different commercial and charitable organisations. Most recently, from 2009 to 2016, he was Finance Director of Pathfinder Minerals Plc, an AIM-traded mining exploration company.

The following information is disclosed pursuant to paragraph (g) of Schedule Two of the AIM Rules for Companies.

Mr Normand, aged 63, has held the following directorships and / or partnerships in the past 5 years:

 
  Current:                                Past: 
  The London Diocesan Board of Finance    Micah Minerals Limited 
  The London Diocesan Fund                IM Minerals Limited 
  Nyota Minerals Limited                  Pathfinder Minerals PLC 
  Nyota Minerals (UK) Limited 
 

As at the date of this announcement Mr Normand does not have any interest in any ordinary shares of the Company.

There is no further information to be disclosed in relation to Mr Normand 's appointment pursuant to AIM Rule 17 or paragraph (g) of Schedule Two of the AIM Rules for Companies.

Appointment of Nominated Adviser

Further to the Exchange's announcement of 10 October 2017 and the Company's announcement of 11 October 2017 regarding the pending removal of ZAI Corporate Finance Limited from the register of nominated advisers, the Company has appointed Beaumont Cornish Limited as its nominated adviser. Given the particular circumstances, the Exchange has agreed that Beaumont Cornish Limited has until 5pm on 19 December 2017 to finalise its due diligence and provide all relevant nominated adviser confirmations to the Exchange.

There can be no guarantee that Beaumont Cornish Limited will be able to conclude its due diligence satisfactorily by 5pm on 19 December 2017 or to provide the relevant declaration to the Exchange. Accordingly, in such circumstances there is a risk that the Company's AIM securities will be suspended on or before 5pm on 19 December 2017 pursuant to AIM Rule 1. If within one month of that suspension the Company has failed to appoint a replacement nominated adviser, the admission of its AIM securities will be cancelled.

Notwithstanding the extension of time provided in respect of due diligence obligations at engagement, Beaumont Cornish Limited will continue to be subject to all the ongoing nominated adviser responsibilities under the AIM Rules for Nominated Advisers.

Business Review

As stated in the Company's Circular to Shareholders sent on 13 October 2017, the Directors believe that the retention of its interests in the mining projects is no longer viable. Accordingly, the Directors are actively pursuing the disposal of the Company's interest in its immediate subsidiary company, CRGNV, and have begun the process of seeking all regulatory approvals necessary to effect a proposed sale of the Company's mining operations to a consortium of certain of the Company's lenders, being Mr Jiabang Wang, Redstone Capital Limited and Mrs Zhu, for a nominal sum in exchange for cancellation of all loans owed by the Company to those parties and interest accrued thereon, being approximately US$8.3 million and the corporate assumption of approximately US$8.0 million of trade and other payables.

The anticipated disposal, should it complete, will amount to a fundamental disposal of the business pursuant to Rule 15 of the AIM Rules which requires the approval, by way of an ordinary resolution, of the Shareholders at the General Meeting, after which the Company will become an AIM Rule 15 Cash Shell.

Within six months of becoming a Rule 15 Cash Shell, the Company must make an acquisition or acquisitions which constitute(s) a reverse takeover under AIM Rule 14. If it does not do so, the London Stock Exchange will suspend trading in the Company's AIM securities pursuant to AIM Rule 40. The London Stock Exchange will cancel the admission of the Company's AIM securities pursuant to AIM Rule 41 where they have been suspended from trading for six months.

The anticipated disposal remains subject to certain regulatory approvals and final commercial agreement between the parties. No guarantee can be made that all these conditions will be met.

The Directors intend that:

   --     the Company will make no further investment in CRGNV; 
   --     no further funds will be paid upward from CRGNV to the Company; and 
   --     all intercompany loans will be cancelled. 

Market Abuse Regulation

The Market Abuse Regulation ("MAR") became effective from 3 July 2016. Market Soundings, as defined in MAR, were taken in respect of the Placing, with the result that certain persons became aware of inside information, as permitted by MAR. That inside information is set out in this announcement and has been disclosed as soon as possible in accordance with paragraph 7 of article 17 of MAR. Therefore, those persons that received inside information in a Market Sounding are no longer in possession of inside information relating to the Company and its securities.

For further information, please contact:

 
                                         [phone] 
 Central Rand Gold Limited                4400 
 Simon Charles 
 Beaumont Cornish Limited - Financial    [phone] 
  & Nominated Adviser                     3396 
 Roland Cornish 
 Peterhouse Corporate Finance Limited    [phone] 
  - Broker                                0930 
 Lucy Williams and Fungai Ndoro 
                                         [phone] 
 Merchantec Capital - JSE Sponsor         6363 
 Monique Martinez / Marcel Goncalves 
 

This information is provided by RNS

The company news service from the London Stock Exchange

END

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October 19, 2017 02:00 ET (06:00 GMT)