REG - Chaarat Gold Hlgs Ld - Letter of Intent for US$250 million Investment

Chaarat Gold HoldingsAnnouncement

17/05/2023 07:17

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RNS Number : 6475Z  Chaarat Gold Holdings Ltd  17 May 2023

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF
THE MARKET ABUSE REGULATION (EU) 596/2014 AS IT FORMS PART OF UK DOMESTIC LAW
BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018 ("MAR"), AND IS
DISCLOSED IN ACCORDANCE WITH THE COMPANY'S OBLIGATIONS UNDER ARTICLE 17 OF MAR

 

FOR IMMEDIATE RELEASE

 

17 May 2023

 

Chaarat Gold Holdings Limited

 

("Chaarat" or the "Company")

 

Non-binding Letter of Intent for US$250 million Investment

 

Chaarat Gold (AIM: CGH), the AIM-quoted gold mining Company with an operating
mine in Armenia, and assets at various stages of development in the Kyrgyz
Republic, is pleased to announce the signing of a non-binding letter of intent
("LOI") and an indicative term sheet with Xiwang International Company Limited
("Xiwang") for a potential equity investment of US$250 million (the
"Investment").

 

The Investment would be used to develop Chaarat's organic pipeline and
external growth through value-added acquisitions. The Investment would be in
the form of a new issue of shares in Chaarat at a price of £0.20 per share
resulting in Xiwang holding 60% of the shares in Chaarat.  Should the
Investment be completed, it is anticipated that Xiwang would have the right to
appoint two members to the Chaarat board.  As part of the completion
documentation, it is expected that Xiwang and Chaarat would enter into a
relationship agreement containing provisions typically found in such an
agreement to ensure that the Company would continue to operate independently.

 

Chaarat and Xiwang expect to agree the terms of a preliminary investment
agreement ("PIA") by the end of May 2023. Upon completion of the PIA, it is
the intention of the parties to enter into a formal investment agreement with
completion by 30 July 2023.  Conditions precedent to completing the
Investment would include completion of all remaining due diligence, Xiwang
completing its financing, and receipt of all necessary corporate, government,
and regulatory approvals.

 

As a British Virgin Islands incorporated company, Chaarat is not directly
subject to any restrictions on takeover offers such as those which exist in
the United Kingdom pursuant to the City Code on Takeovers and Mergers.
However, Chaarat's articles of association (the "Articles") include provisions
dealing with takeover bids, squeeze-out and sell-out. Should the Investment be
completed it is not anticipated that the Chaarat board will exercise its right
to request an extension of the offer to all other shareholders pursuant to
Regulation 19 of the Articles (1).

 

The LOI is not binding and there is no certainty at this stage that the
proposed Investment will be completed. A further announcement will be made
when appropriate.

 

About Xiwang

 

Xiwang International Company Ltd (Xiwang) is an investment company
incorporated in the British Virgin Islands. As part of its long-term strategic
investment plan, Xiwang is looking to create a significant portfolio of mining
assets and resources on a global basis by partnering with and providing
funding to listed public operating companies with strong governance, focussed
on disciplined capital allocation and shareholder value creation.

 

 

Martin Andersson, Executive Chair of Chaarat, said:

 

"We are pleased to have taken the discussions with Xiwang to this stage. We
will now work with Xiwang towards progressing the PIA and subsequent
investment and relationship agreements to support the growth objectives of
Chaarat.

 

Xiwang is undergoing a transformational change and Chaarat is one of the
potential platforms for their investment consideration and passed their
initial due diligence, governance and investment criteria."

 

 Enquiries

 Chaarat Gold Holdings Limited                       +44 (0)20 7499 2612
 Mike Fraser (Chief Executive Officer)               ir@chaarat.com (mailto:ir@chaarat.com)

 Canaccord Genuity Limited (NOMAD and Joint Broker)  +44 (0)20 7523 8000
 Henry Fitzgerald-O'Connor
 James Asensio

 finnCap Limited (Joint Broker)                      +44 (0)20 7220 0500
 Christopher Raggett

 Panmure Gordon (UK) Limited (Joint Broker)          +44 (0)20 7886 2500
 John Prior

 Hugh Rich

 

 

About Chaarat

 

Chaarat is a gold mining company which owns the Kapan operating mine in
Armenia as well as Tulkubash and Kyzyltash Gold Projects in the Kyrgyz
Republic. The Company has a clear strategy to build a leading emerging markets
gold company through organic growth and selective M&A.

 

Chaarat aims to create value for its shareholders, employees, and communities
from its high-quality gold and mineral deposits by building relationships
based on trust and operating to the best environmental, social, and employment
standards. Further information is available at www.chaarat.com
(http://www.chaarat.com) .

 

 

Note

(1) The full text of these provisions can be found in Regulation 19 of the
Articles which are available on the Company's website at this link: Articles
(https://www.chaarat.com/wp-content/uploads/2019/11/Chaarat-Gold-Holdings-Limited.pdf#page=31)

 

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