Vela Technologies PLC Update re proposed investment in BlockchainK2 Corp (2401B)

TIDMVELA

RNS Number : 2401B

Vela Technologies PLC

08 January 2018

8 January 2018

Vela Technologies plc

("Vela")

Update re. proposed investment in BlockchainK2 Corp.

Further to the announcement released by Vela on 8 December 2017, the Board of Vela (AIM: VELA), the investing company focused on early-stage and pre-IPO disruptive technology investments, is pleased to note the update announcement made on 5 January 2018 by Africa Hydrocarbons Inc. ("Africa Hydrocarbons") regarding its "Change of Business" transaction. Africa Hydrocarbons has announced that on completion of the Change of Business transaction, it intends to acquire no less than CAD$1.6 million worth of cryptocurrency mining rigs and other equipment necessary to commence operations and mine Bitcoin (algorithm SHA256), subject to larger acquisitions of equipment should the Company raise a larger amount of funds in connection with the COB Transaction. Africa Hydrocarbons also announced that the resolution to change the name of the company to BlockchainK2 Corp. ("BlockchainK2") was approved at the annual general meeting held on 4 January 2018.

As previously announced, Vela entered into a conditional agreement to invest GBP200,589 to acquire a minority equity stake in BlockchainK2 (the "Proposed Investment"). BlockchainK2 is a cryptocurrency and blockchain platform that offers mining exposure and proprietary software as a service (SAAS) blockchain solutions with leading industry partners. The Proposed Investment will be funded from Vela's existing cash resources. The Proposed Investment remains subject to a number of conditions being satisfied. If the COB Transaction is not completed then the Proposed Investment would not take place and funds would be returned to Vela. There can be no assurances that the COB Transaction and the Proposed Investment will be completed.

Further announcements on the Proposed Investment will be made by Vela at the appropriate time.

Extracts from the Africa Hydrocarbons announcement are copied below:

Africa Hydrocarbons Inc. (NFK.H: NEX | KNPRF: PNK | KRL1: STU) (the "Company") is pleased to provide an update on its previously announced "Change of Business" transaction ("COB Transaction") pursuant to the policies of the TSX Venture Exchange (the "Exchange"), with the result that the Company will become a blockchain technology company, listed on the Exchange (see the Company's November 23, 2017 press release).

Further to that previous announcement, upon completion of the COB Transaction, the Company now plans to acquire no less than CAD$1.6 million worth of cryptocurrency mining rigs and other equipment necessary to commence operations and mine Bitcoin (algorithm SHA256), subject to larger acquisitions of equipment should the Company raise a larger amount of funds in connection with the COB Transaction. The Company executed a non-binding agreement on October 25, 2017 with a cryptocurrency mining equipment supplier in connection with such order, and expects that it should receive the equipment within two (2) months of making such order - which order will be made upon completion of the COB Transaction, unless the Exchange grants early approval to the Company to make such equipment order.

The Company has also made the determination to build its initial cryptocurrency mining facility at a third-party data center located in the State of Georgia in the United States, a low cost electricity jurisdiction.

Financing

With respect to the Company's previously announced non-brokered private placement (the "Private Placement") of Subscription Receipts that is being completed concurrently with the COB Transaction (see the Company's November 24, 2017 press release), the Company has received incredible interest and expects to close such Financing within the next 7 to 10 days, if not sooner.

Annual General and Special Meeting of Shareholders

The Company is also pleased to announce that all resolution presented at the annual general and special meeting of shareholders of the Company on January 4, 2018 (the "AGM") were approved, including the resolution to change the name of the Company to "BlockchainK2 Corp.". The Company has reserved the stock symbol "BITK" in connection with such proposed name change. The name and stock symbol change will be completed in connection with the COB Transaction and is subject to applicable Exchange and other regulatory approvals.

Board of Directors and Management

As previously announced, current directors, Douglas Wu, Sergei Stetsenko and Andri Stytsenko, will remain on the Board of Directors upon completion of the COB Transaction. Biographies for Mr. Douglas Wu and Mr. Sergei Stetsenko are set forth in the Company's November 23, 2017 press release. As for Mr. Andri Stytsenko, he is a dual citizen of Canada and the Ukraine, and has a degree in Petroleum Engineering, with over 28 years in the industry, including 6 years at Halliburton in Western Canada. He is also an early adopter of crypto currency mining and has been involved with accessing suitable data center locations with economic energy sources, both in Western Canada and Eastern Europe.

General

The COB Transaction is conditional upon, among other things:

a. the Company preparing a filing statement in accordance with the rules of the Exchange, outlining the terms of the COB Transaction and the resulting business of the Company;

b. receipt of all requisite regulatory approvals, including the approval of the Exchange, and any third party approvals and authorizations (if applicable);

c. the Company obtaining the requisite shareholder approvals for the COB Transaction (as applicable);

d. the Company completing a private placement financing for minimum gross proceeds of not less than $2,000,000; and

e. the Company meeting the applicable Initial Listing Requirements of the Exchange as a Technology Issuer (pursuant to Policy 2.1 - Initial Listing Requirements of the Exchange), including, without limitation, the public float requirements.

Trading in the common shares of the Company has been halted in accordance with the policies of the Exchange and will remain halted until such time as all required documentation has been filed with and accepted by the Exchange and permission to resume trading has been obtained from the Exchange. The Company will then operate within the technology sector. Since (i) the common shares of the Company are listed on the NEX market of the Exchange, (ii) the proposed COB Transaction does not constitute a related party transaction under the policies of the Exchange, (iii) the Company is not, and does not expect to be subject to a cease trade order upon completion of the COB Transaction, and (iv) shareholder approval is not required to complete the COB Transaction under applicable corporate and securities laws, the Company does not expect to be required to seek shareholder approval for the COB Transaction.

The Company will continue to issue additional press releases related to the COB Transaction, the Private Placement, sponsorship and other material information as it becomes available.

ON BEHALF OF THE BOARD OF

AFRICA HYDROCARBONS INC.

Douglas Wu

Director

For further information, please telephone: [phone].

Completion of the COB Transaction is subject to a number of conditions, including but not limited to acceptance by the Exchange and if applicable pursuant to the Exchange requirements, majority of the minority shareholder approval. Where applicable, the COB Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the COB Transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the COB Transaction, any information released or received with respect to the acquisition may not be accurate or complete and should not be relied upon. Trading in the securities of the Company should be considered highly speculative.

The Exchange has in no way passed upon the merits of the COB Transaction and has neither approved nor disapproved the contents of this news release. Neither the Exchange nor its Regulation Services Provider (as that term is defined in policies of the Exchange) accepts responsibility for the adequacy or accuracy of this news release.

For further information, please contact:

 
  Vela Technologies plc 
   Brent Fitzpatrick, Non-Executive 
    Chairman                           Tel: [phone] 
    Antony Laiker, Director            262 443 
   Allenby Capital Limited 
    (Nominated Adviser) 
    Nick Athanas/Katrina Perez/Asha    Tel: +44 (0) 20 
    Chotai                             3328 5656 
   Smaller Company Capital 
    Limited 
    (Broker)                           Tel: +44 (0) 20 
    Rupert Williams/Jeremy Woodgate    3651 2910 
 

This information is provided by RNS

The company news service from the London Stock Exchange

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January 08, 2018 06:39 ET (11:39 GMT)