Galileo Resources - Conditional Sale of 2 Copper Belt Licences for $3m

Galileo Resources

Today 07:00

RNS Number : 3660I
  
Galileo Resources PLC
  
16 June 2026
  
 


                             
 
16 June 2026
Galileo Resources Plc
("Galileo" or the "Company")
 
Conditional Sale of 2 Kalahari Copper Belt Licences for US$3 million
to Sandfire Resources Limited group
 
Galileo Resources plc ("Galileo" or the "Company") is pleased to announce that on 15 June 2026 it entered into a conditional share purchase agreement with Metal Capital Exploration Limited ("Metal Capital"), a wholly owned subsidiary of ASX-listed Sandfire Resources Limited (Sandfire), with Sandfire acting as purchaser guarantor.
 
The agreement relates to the conditional sale of its wholly owned subsidiary Virgo Business Solutions (Pty) Ltd ("Virgo"), which owns Botswana prospecting licences PL039/2018 and PL040/2018 (the, "Prospecting Licences") (the "Agreement").
 
The Agreement provides for an aggregate upfront consideration of US$3 million payable on completion, together with a potential one-off success payment of between US$20 million and up to US$80 million ("Success Payment"), subject to meeting nominated thresholds for contained copper  in a First Qualifying Ore Reserve under the terms of the Agreement.
 
Under the Agreement:
 
·    Metal Capital has made an exploration commitment of US$4.5 million on the Prospecting Licences (the "Exploration Commitment") within three years of completion (the "Exploration Period"), with US$2.25 million of that amount of the Exploration Commitment to be spent within 18 months of completion and US$2.7 million of that amount of the Exploration Commitment is to be spent on drilling and assaying.  Metal Capital has committed, subject to necessary approvals, permits and consents to complete at least 4,000 metres of drilling on the Prospecting Licences by 31 December 2026.
 
·    A one-off Success Payment is payable to the Company if the first qualifying ore reserve reported under JORC Code 2012 edition, as amended or replaced from time to time ("JORC") on the Prospecting Licences contains at least 400,000 tonnes of contained copper (the "First Qualifying Ore Reserve").  
 
Colin Bird Chairman commented
 
"Metal Capital is a wholly owned subsidiary of Sandfire, with whom Galileo has an existing relationship in Botswana. From Galileo's point of view the transaction makes strategic sense as our highly prospective portfolio and our people resources are primarily located in Zambia and Zimbabwe, so we are better equipped to focus on and advance projects there. The structure of the transaction provides for consideration now and a significant future success payment if our belief in the potential of the Prospecting Licences is realised.  We look forward to Metal Capital progressing the agreed Exploration Commitment and wish them every success in this regard."
 
Overview of transaction with Metal Capital and Sandfire 
 
Upon completion under the Agreement, the Company will receive aggregate upfront cash consideration of US$3.0 million, which it intends to apply towards investment in the Company's principal projects in Zambia and Zimbabwe, with the prospect of a significant Success Payment if a First Qualifying Ore Reserve containing at least 400,000 tonnes of contained copper is declared, subject to the terms of the Agreement. The Board advises shareholders that the Success Payment is dependent upon the success of future exploration and therefore is not guaranteed as the Prospecting Licences have no defined Mineral Resource estimate.  As previously announced on 26 January 2021 , the Company has a similar Success Payment arrangement in relation to prospecting licences sold to Sandfire in 2021.
 
Further Information on Assets being sold
On 21 May 2020 the Company acquired Crocus-Serv Resources Pty Ltd, which owns PL253/2018 and is not being sold, and Virgo for £173,848.  Since then, the Company has undertaken exploration work on the Prospecting Licences which is summarised in the Company's group accounts to 31 March 2025, the group carrying value was £1.19m, made up principally of intangible assets held at the parent company level. Virgo had an attributable loss of £117K for the year ended 31 March 2025.  Subject to completion, the Company expects to record a profit on the disposal of Virgo and this will be reported in the audited accounts for the year ended 31 March 2027.
 
Summary of Agreement:




Consideration


US$3.0 million in cash payable on Completion, comprising US$1.5 million payable in respect of the sale shares and the repayment, discharge and release of related loans, and a further US$1.5 million payable by the Purchaser to the Seller Guarantor as a parent guarantee fee.




Success Payment


The Success Payment is only triggered if a First Qualifying Ore Reserve containing at least 400,000 tonnes of contained copper is declared.  If  a First Qualifying Ore Reserve is determined this will be dependent upon the success of future exploration and so is not guaranteed. The one-off Success Payment will be calculated in accordance with the table below:  
 




Contained copper (Cu) in First Qualifying Ore Reserve
Between the following:


Success Payment (USD)
payable




 At least 400Kt Cu and less than 600Kt Cu


$20,000,000




At least 600Kt Cu and less than 750Kt Cu


$40,000,000




At least 750Kt Cu


$80,000,000




 
The Success Payment is due to be paid in cash within 30 days from the date Sandfire announces an Ore Reserve which triggers the payment of the Success Payment (the "Success Payment Completion Date").  
 




Conditions Precedent


Completion is conditional upon:
1.    ministerial consent in respect of the transaction, including any approval required as a result of the indirect change in control or ownership of Virgo, by the Botswana Minister of the Ministry of Minerals and Energy ("Ministerial Consent");
2.    all ASX and AIM regulatory approvals or confirmations required in connection with the transaction, if any; and
3.    approval in writing of the Consumer and Competition Authority of Botswana in respect of the transaction or confirmation that such approval is not required ("Competition Approval")
 
If the Ministerial Consent and / or the Competition Approval is not granted by the Long Stop Date the agreement may be terminated in accordance with its terms, subject to the extension mechanics in the Agreement.
 




Long Stop Date


The long stop date for the meeting of the Conditions Precedent is 15 September 2026, subject to any extension in accordance with the Agreement.
 




Governing Law


The agreement is governed by and construed under the laws of Botswana 
 




Representations & Warranties


The parties have given customary representations and warranties for an agreement of this nature.




 
Information regarding Sandfire has been sourced from Sandfire's public announcements and website.
 
You can also follow Galileo on Twitter: @GalileoResource
 
For further information, please contact: Galileo Resources PLC
 




Colin Bird, Chairman


Tel +44 (0) 20 7581 4477




Beaumont Cornish Limited - Nomad
Roland Cornish/James Biddle


Tel +44 (0) 20 7628 3396




Novum Securities Limited - Joint Broker
Colin Rowbury /Jon Belliss


+44 (0) 20 7399 9400




Shard Capital Partners LLP - Joint Broker
Damon Heath


Tel +44 (0) 20 7186 9952




 
The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 as it forms part of UK Domestic Law by virtue of the European Union (Withdrawal) Act 2018 ("UK MAR").
 
Technical Glossary:
An 'Ore Reserve' is the economically mineable part of a Measured and/or Indicated Mineral Resource. It includes diluting materials and allowances for losses, which may occur when the material is mined or extracted and is defined by studies at Pre-Feasibility or Feasibility level as appropriate that include application of Modifying Factors. Such studies demonstrate that, at the time of reporting, extraction could reasonably be justified.
 
A 'Mineral Resource' is a concentration or occurrence of solid material of economic interest in or on the Earth's crust in such form, grade (or quality), and quantity that there are reasonable prospects for eventual economic extraction. The location, quantity, grade (or quality), continuity and other geological characteristics of a Mineral Resource are known, estimated or interpreted from specific geological evidence and knowledge, including sampling. Mineral Resources are sub-divided, in order of increasing geological confidence, into Inferred, Indicated and Measured categories.
 
Beaumont Cornish Limited ("Beaumont Cornish") is the Company's Nominated Adviser and is authorised and regulated by the FCA. Beaumont Cornish's responsibilities as the Company's Nominated Adviser, including a responsibility to advise and guide the Company on its responsibilities under the AIM Rules for Companies and AIM Rules for Nominated Advisers, are owed solely to the London Stock Exchange. Beaumont Cornish is not acting for and will not be responsible to any other persons for providing protections afforded to customers of Beaumont Cornish nor for advising them in relation to the proposed arrangements described in this announcement or any matter referred to in it.
 




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