REG - Baker Steel Res.Tst. - PAL - Sale of Prognoz Royalty Interest

Baker Steel Resources TrustAnnouncement

02/07/2025 07:00

For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20250702:nRSB2869Pa&default-theme=true

RNS Number : 2869P  Baker Steel Resources Trust Ltd  02 July 2025

BAKER STEEL RESOURCES TRUST LIMITED

(Incorporated in Guernsey with registered number 51576 under the provisions of
The Companies (Guernsey) Law, 2008 as amended)

 

2 July 2025

Polar Acquisition Limited ("PAL") - Sale of Prognoz Royalty Interest

Baker Steel Resources Trust Limited (the "Company" or "BSRT") announces that
PAL, in which it holds a 49.99% interest, has signed a binding agreement to
divest its net smelter royalty related to the Prognoz silver project ("Prognoz
Royalty") for a cash consideration of US$11 million (or its Euro equivalent on
closing at the buyer's election).

The sale of the Prognoz Royalty is by way of assignment to the buyer, a
private Omani registered company. Solidcore Resources plc (previously
Polymetal International PLC ("Polymetal")) was the sole counterparty to the
Prognoz Royalty Agreement, and has declined to exercise its right of first
refusal to acquire the Prognoz Royalty on the sale by PAL. The cash
consideration is due to be paid within 5 business days and PAL intends to
distribute the net proceeds after transaction expenses, accruals and a
provision for the subsequent winding up of PAL as soon as practical
thereafter.

As a result, BSRT can expect to receive approximately US$5.16 million in cash
during the third quarter. This is approximately 4.1 times the US$1.24 million
carrying value of its holding PAL as at the last published NAV on 30 May 2025.

The Prognoz Royalty was acquired by PAL as part of its sale to Polymetal in
2017 of its 50% interest in the Prognoz Silver asset which consideration
comprised shares in Polymetal and the Prognoz Royalty. BSRT subsequently
disposed of its shares in Polymetal at favourable prices and retained the
Prognoz Royalty through PAL. Despite the unforeseen adverse geopolitical
events reducing the valuation of the Prognoz Royalty the overall return for
BSRT including the earlier sale proceeds will have provided for a total return
of US$48.9 million or around 3 times the total US$15.9 million invested. The
earlier sale of the Polymetal shares previously funded a tender offer of £4.9
million.

The Investment Manager and Board regard the monetisation of its interest in
the Prognoz Royalty as a satisfactory outcome given the uncertainty of
information supporting fair calculation of, and risks associated with
receiving, royalty payments based on a privately owned project located in
Russia, which had led to the valuation being heavily discounted.

In light of the expected receipt of PAL proceeds, and other prospective
capital payments which may come through later this year, the Board continues
to review its capital allocation policy, with its primary objective being the
reduction of the discount of the share price to net asset value. A further
update will be provided in due course.

 

 

Further details of the Company and its investments are available on the Baker
Steel Capital Managers website www.bakersteelcap.com
(https://url.avanan.click/v2/___http:/www.bakersteelcap.com___.YXAxZTpzaG9yZWNhcDphOm86MjdlZGQ1NzE1MDA2OWIwMWI0NzUxYWYwYjc5OWUzNTk6NjpiYzEwOjkzMDBjNGMzNDY1MGVhOGQwZjg2Yjk0OWEzY2U2ODYwZDI0MDYxY2Y3MmU3MDM0OWJkOTAyZWZhZWViMDM0NTI6cDpUOk4)

 

Enquiries:

Baker Steel Resources Trust Limited             +44 20 7389 8237

Francis Johnstone

Trevor Steel

 

Shore Capital
     +44 020 7408 4050

Henry Willcocks (Corporate Broking)

Gillian Martin, Daphne Zhang (Corporate)

Adam Gill (Sales)

 

 

The Net Asset Value ("NAV") figure stated is based on unaudited estimated
valuations of the underlying investments and not necessarily based on
observable inputs. Such estimates are not subject to any independent
verification or other due diligence and may not comply with generally accepted
accounting practices or other generally accepted valuation principles. In
addition, some estimated valuations are based on the latest available
information which may relate to some time before the date set out above.

 

Accordingly, no reliance should be placed on such estimated valuations and
they should only be taken as an indicative guide. Other risk factors which may
be relevant to the NAV figure are set out in the Company's Prospectus dated 26
January 2015.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  UPDUPUWPMUPAGQG