REG - Power Metal - Disposal of Reitenbach Uranium Property – Canada

Power Metal ResourcesAnnouncement

08/08/2022 09:15

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RNS Number : 2397V  Power Metal Resources PLC  08 August 2022

8 August 2022

Power Metal Resources PLC

("Power Metal" or the "Company")

Disposal of Reitenbach Uranium Property - Saskatchewan, Canada

 

Power Metal Resources plc (LON:POW), the London listed exploration company
seeking large-scale metal discoveries across its global project portfolio
announces the conditional disposal of its 100% owned Reitenbach Uranium
Property ("Reitenbach" or the "Property") located east of the prolific
Athabasca Basin in Northern Saskatchewan, Canada.

HIGHLIGHTS:

-      A Property Purchase Agreement (the "Agreement") has been signed
with Teathers Financial Plc ("Teathers Financial" or "Teathers").  Teathers
Financial is to conditionally acquire 100% ownership of the Property, subject
to a 2% net smelter return ("NSR") royalty, in exchange for cash and shares.

-      The consideration payable is £360,000 (to be settled by the issue
of Teathers Financial new ordinary shares of 0.1p ("Ordinary Shares") and a
cash payment of £10,000 (see detailed terms below)).

-      Reitenbach is one of ten uranium properties held by 102134984
Saskatchewan Ltd ("Power Sask"), a wholly owned subsidiary of Power Metal
Resources Canada ("POW Canada") which itself is a wholly owned subsidiary of
Power Metal.

-      Teathers Financial is currently in the advance stages of preparing
for a change of business to become a uranium focused exploration company which
plans to list on the London equity capital markets - targeted for Q3 2022.

Paul Johnson, Chief Executive Officer of Power Metal Resources PLC commented:

"Power Metal has secured another crystallisation event with the disposal of
Reitenbach into a vehicle planning to list in the London markets in the near
term.

With the refocussing of Teathers into a uranium exploration vehicle with
Reitenbach as their flagship property, we believe the proposition will attract
pre-IPO and IPO financing interest, and trade successfully as a listed
vehicle.

Outside of Reitenbach, we continue to own 100% of our remaining nine Athabasca
properties, some of which we expect to explore ourselves and, given the level
of interest in quality uranium projects, some may be the subject of further
disposals. In this regard, datarooms are being established for all projects to
enable expeditious third party review.

Further information to follow regarding this disposal and other exploration
and corporate activities in respect of our Athabasca property portfolio."

TRANSACTION TERMS

For the sale of 100% of the Company's interest in the Reitenbach Property, one
of ten uranium focused properties held by Power Metal surrounding the
Athabasca Basin, Saskatchewan, Canada, the consideration of £360,000 is to be
settled by:

·    The issue to Power Sask of 98,700,000 Teathers Financial Ordinary
Shares at a price of 0.35461p per share for a total value of £350,000.

·    A cash payment to Power Sask  totalling £10,000, which covers
several costs incurred by Power Metal on behalf of Power Sask and Power Canada
in preparation of this transaction. This also covers costs of the National
Instrument 43-101 report that was completed over the Property - which will
allow Reitenbach to be the main listing asset for Teathers Financial during
its upcoming planned listing.

Power Sask will retain a 2% Net Smelter Return ("NSR") 1  (#_ftn1) royalty
across the Property, 1% of which can be bought back by Teathers Financial at
anytime prior to production for £750,000.

The transaction is conditional on:

-     Teathers Financial securing a £125,000 initial pre-IPO financing to
cover transactional costs in relation to the planned listing.

-     The approval of Teathers Financial shareholders to the transaction;
to a Rule 9 Whitewash arrangement, enabling Power Metal to acquire its
interest without a requirement to make an offer for the entire company and
approval of a capital reorganisation of Teathers.

-     Admission of Teathers shares to trading on the London equity capital
markets.

After the issue of further shares following completion of  Teathers Financial
pre-IPO and IPO financings, Power Metal anticipates its holding will amount to
40-55% of Teathers Financial issued share capital on listing. Power Metal will
provide further updates on this in due course.

NEXT STEPS

 

·    Exploration programmes are currently being planned across the
Reitenbach Property, which subject to completion of the Agreement will be
carried out by Teathers Financial following their planned listing in the
London capital markets.

·    Power Metal, with its in house technical group with expertise in
uranium exploration, have agreed to provide Teathers with ongoing technical
consulting services, to be paid for by Teathers, relating to planned and
future exploration programmes on the Reitenbach Property.

·    Reflecting the growing interest shown from third parties,
comprehensive datarooms and factsheets are being established for all of the
Company's Saskatchewan based uranium assets.

THE REITENBACH PROPERTY

A detailed breakdown of all publically available technical information over
the Reitenbach Uranium Property was released to the market on 8 February 2022
and can be found at the link below:

https://www.londonstockexchange.com/news-article/POW/reitenbach-uranium-property-athabasca-basin/15319141
(https://www.londonstockexchange.com/news-article/POW/reitenbach-uranium-property-athabasca-basin/15319141)

The Power Metal book value of the Reitenbach Property is £55,292 and no
losses have been recorded in respect of the Property in the year ended 30
September 2021, with all costs capitalised.

URANIUM PROPERTY HOLDING STRUCTURE

Power Metal has a 100% subsidiary Power Metal Canada Inc ("Power Canada").
which acts as the holding company for certain Canadian project operations.

Power Canada has a wholly owned subsidiary, 102134984 Saskatchewan Ltd, which
is the holder of all the uranium properties.

 

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 further information please visit https://www.powermetalresources.com/
(https://www.powermetalresources.com/)  or contact:

 Power Metal Resources plc
 Paul Johnson (Chief Executive Officer)                                          +44 (0) 7766 465 617

 SP Angel Corporate Finance (Nomad and Joint Broker)
 Ewan Leggat/Charlie Bouverat                                                    +44 (0) 20 3470 0470

 SI Capital Limited (Joint Broker)
 Nick Emerson                                                                    +44 (0) 1483 413 500

 First Equity Limited (Joint Broker)
 David Cockbill/Jason Robertson                                                  +44 (0) 20 7330 1883

 

NOTES TO EDITORS

Power Metal Resources plc - Background

Power Metal Resources plc (LON:POW) is an AIM listed metals exploration
company which finances and manages global resource projects and is seeking
large scale metal discoveries.

The Company has a principal focus on opportunities offering district scale
potential across a global portfolio including precious, base and strategic
metal exploration in North America, Africa and Australia.

Project interests range from early-stage greenfield exploration to later-stage
prospects currently subject to drill programmes.

Power Metal will develop projects internally or through strategic joint
ventures until a project becomes ready for disposal through outright sale or
separate listing on a recognised stock exchange thereby crystallising the
value generated from our internal exploration and development work.

Value generated through disposals will be deployed internally to drive the
Company's growth or may be returned to shareholders through share buy backs,
dividends or in-specie distributions of assets.

Exploration Work Overview

Power Metal has internal exploration programmes completed or underway, with
results awaited, as outlined in the table below.

Exploration work programmes may also be underway within planned IPO vehicles
where Power Metal has a material interest the findings from which will be
released on their respective websites, with simultaneous updates through Power
Metal regulatory announcements where required:

www.firstclassmetalsplc.com (http://www.firstclassmetalsplc.com)

www.goldenmetalresources.com (http://www.goldenmetalresources.com)

www.firstdevelopmentresources.com (http://www.firstdevelopmentresources.com)

For planned IPO vehicle New Ballarat Gold Corporation PLC (NBCG) a new website
is currently in development which will be found at www.newballaratgold.com .
In the interim further information in respect of NBGC can be found at
https://www.powermetalresources.com/project/victoria-goldfields/
(https://www.powermetalresources.com/project/victoria-goldfields/) .

Power Metal also holds a material investment in Kavango Resources plc with
exploration updates available through their regulatory announcements and on
their website:

www.kavangoresources.com (http://www.kavangoresources.com)

 

 Project                Location  Current          Work Completed or Underway                                                     Results Awaited

                                  POW %

 Athabasca Uranium      Canada    100%             Hyperspectral data analysis conducted across 7 properties. Updating to 9 data  Finalise review of data from 3 properties.  Prepare for summer exploration
                                                   rooms for third party review.                                                  programme across 4 properties.
 Authier North Lithium  Canada    Earn-in to 100%  Property Evaluation Report completed.                                          Update covering exploration plans for target areas identified during the
                                                                                                                                  Evaluation.
 Molopo Farms           Botswana  53%(#)           Comprehensive data review complete and establishment of data room for third    Finalise drill programme targets, select drill contractor and launch drill
                                                   party review. Geophysics programme underway.                                   programme.
 Tati Project           Botswana  100%             Site visit with mapping of gold workings and mine dumps.                       Exploration planning underway including further mapping, sampling and launch
                                                                                                                                  of an RC drill programme.

(#) subject to completion of acquisition announced 18.5.22 interest will
increase to 87.71%

 

 

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