REG - Premier African Min - Zulu Lithium DFS Funding

Premier African MineralsAnnouncement

08/03/2022 17:15

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RNS Number : 0567E  Premier African Minerals Limited  08 March 2022

8 March 2022

Premier African Minerals Limited

 

Zulu Lithium DFS Funding

Premier African Minerals Limited ("Premier" or the "Company"), is pleased to
announce a conditional subscription for new ordinary shares by Suzhou
TA&A Ultra Clean Technology Co., Ltd ("Suzhou TA&A") to raise £12
million before expenses at an issue price of 0.4 pence per new ordinary share
for the ongoing DFS at Premier's Zulu Lithium and Tantalum Project ("Zulu")
(the "Subscription").

 

Highlights:

 ·         The Subscription fully funds the completion of DFS underway at Zulu.
 ·         Suzhou TA&A is listed on the Shenzhen Stock Exchange (SZSE: 300390) and
           has a market capitalisation of ¥42.9 Billion (£5.1billion).
 ·         The Subscription agreement affords Suzhou TA&A additional rights set out
           below, including a right to negotiate their future involvement and/or
           investment in support of the Company.
 ·         Premier anticipates active involvement and expertise from Suzhou TA&A in
           the development of the DFS.

George Roach, CEO commented, "I am delighted to accept this Subscription from
Suzhou TA&A, and particularly that this makes available to Premier a
wealth of expertise in this industry whilst aligning future offtake and mine
development with Yibin Tianyi Lithium Industry Co., Ltd., a major producer of
Lithium Hydroxides, financier and take-off partner for the Manono Lithium and
Tin project and who have completed long term spodumene off-take agreements
with Pilbara Minerals Limited.

I look forward to welcoming a new board member who will be nominated by Suzhou
TA&A and active involvement from Suzhou TA&A in our DFS, particularly
in the area of test work and flow sheet development.

Developments within the lithium industry have been at so rapid a pace, that it
is often difficult to ascertain and agree value. This Subscription that
results in Suzhou TA&A holding an important stake in Premier, affords our
shareholders (including Suzhou TA&A) with the opportunity to accelerate
the DFS and at the same time negotiate an equitable path to future
development. The Subscription also allows Premier to be in control of its own
destiny and affords an opportunity to develop downstream beneficiation of
spodumene through the retention of not less than 50 per cent of the off-take
rights to production from a future mine."

Subscription Agreement

 

On 7 March 2022, Premier and Suzhou TA&A entered into a Subscription
Agreement (together the "Parties"). Suzhou TA&A has conditionally agreed
to subscribe £12 million before expenses for 3,000,000,000 new ordinary
shares ("Subscription Shares") at an issue price of 0.4 pence within 15
business days following the entering into of the Subscription Agreement, to
acquire a direct interest of 13.38 per cent in the enlarged issued share
capital of Premier following completion of the Subscription.

The Parties have further agreed that Suzhou TA&A will, following the
Subscription, be awarded the following:

 i.     Exclusive offtake rights on commercial terms to the marketing and
 sale of 50 per cent of all spodumene produced at Zulu ("Offtake Rights");
 ii.    An irrevocable right of first refusal for 180 days from the date of
 the Subscription to match any further equity or loan related funding that is
 contemplated by Premier, in particular any deal relating to Zulu, on terms no
 worse than those offered by another potential investor;
 iii.   A right of participation in any future funding so as to maintain
 Suzhou TA&A's shareholding of 13.38 per cent in Premier at all times; and
 iv.   A right to appoint one director to serve on the boards of Premier,
 Zulu Lithium Mauritius Limited, and Zulu Lithium (Private) Limited ("Board
 Appointment").

The Parties have agreed that should Suzhou TA&A elect to reduce its
overall shareholding in Premier, then its Offtake Rights will be reduced in
direct proportion to its remaining shareholding in Premier. Suzhou TA&A's
Board Appointment will remain in place for as long as Suzhou TA&A holds 10
per cent. of the enlarged issued share capital of Premier.

Conditions Precedent

Completion of the Subscription is conditional on the following:

 i.     Within 15 Business Days of the date of the Subscription, written
 confirmation that Suzhou TA&A has received all applicable outbound direct
 investment approvals and/or registrations from and/or with competent Chinese
 administrative authorities with respect to the Subscription ("Regulatory
 Approvals"); and
 ii.     Each of the standard warranties for a transaction of this type as
 set out in the Subscription agreement being true and accurate as at the
 payment date.

In addition, Suzhou TA&A has agreed to make a non-refundable deposit of
£1.2 million to Premier within 5 Business Days of the signing of the
Subscription while the Regulatory Approvals are obtained ("Deposit"). The
Deposit will be offset against the remaining proceeds of the Subscription
following completion of the Conditions Precedent or retained by Premier in the
event that the Regulatory Approvals are not received.

Premier has agreed to use the net proceeds of the Subscription, primarily,
subject to the reasonable general working capital requirements of the Company,
for the purposes of funding the lithium and tantalum exploration and
exploitation activities of Zulu.

About Suzhou TA&A Ultra Clean Technology Co., LTD.

Suzhou TA&A is listed on the Shenzhen Stock Exchange under the ticker
300390 and holds considerable investments in the lithium sector. Suzhou
TA&A is the largest investor (75 per cent holding) in lithium hydroxide
producer Yibin Tianyi Lithium Industry Co., Ltd., together with China's
largest EV battery manufacturer Contemporary Amperex Technology.  Yibin
Tianyi Lithium Industry Co., Ltd. objective is to become one of the largest
lithium hydroxide producers in the world.

Director undertakings

George Roach and Neil Herbert, directors of the Company, have each undertaken
pursuant to the Subscription Agreement, subject to their fiduciary duties and
compliance with the AIM Rules and Suzhou TA&A being interested in more
than 10 per cent. of Premier, to vote for the appointment of the candidate
proposed by Suzhou TA&A as director under its Board Appointment rights.
George Roach has additionally undertaken as a shareholder in Premier to vote
for the appointment or nomination of the Suzhou TA&A proposed director as
required.

Admission and Voting Rights

The Subscription has been arranged within the Company's existing share
authorities and the Subscription Shares will, when issued, rank pari passu in
all respects with the existing ordinary shares. Application will be made for
the Subscription Shares be admitted to trading on AIM and admission is
expected to take place on or around 29 March 2022.

Upon the issue of the Subscription Shares, the Company's issued share capital
will consists of 22,418,009,831 Ordinary Shares, with voting rights. This
figure may be used by shareholders in the Company as the denominator for the
calculation by which they will determine if they are required to notify their
interest in, or a change to their interest in, the share capital of the
Company under the Financial Conduct Authority's Disclosure and Transparency
Rules.

Market Abuse Regulation

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.

The person who arranged the release of this announcement on behalf of the
Company was George Roach.

Forward Looking Statements

Certain statements in this announcement are or may be deemed to be forward
looking statements. Forward looking statements are identified by their use of
terms and phrases such as ''believe'' ''could'' "should" ''envisage''
''estimate'' ''intend'' ''may'' ''plan'' ''will'' or the negative of those
variations or comparable expressions including references to assumptions.
These forward-looking statements are not based on historical facts but rather
on the Directors' current expectations and assumptions regarding the Company's
future growth results of operations performance future capital and other
expenditures (including the amount. Nature and sources of funding thereof)
competitive advantages business prospects and opportunities. Such forward
looking statements reflect the Directors' current beliefs and assumptions and
are based on information currently available to the Directors. A number of
factors could cause actual results to differ materially from the results
discussed in the forward-looking statements including risks associated with
vulnerability to general economic and business conditions competition
environmental and other regulatory changes actions by governmental authorities
the availability of capital markets reliance on key personnel uninsured and
underinsured losses and other factors many of which are beyond the control of
the Company. Although any forward-looking statements contained in this
announcement are based upon what the Directors believe to be reasonable
assumptions. The Company cannot assure investors that actual results will be
consistent with such forward looking statements.

Enquiries

 

 George Roach                        Premier African Minerals Limited    Tel: +27 (0) 100 201 281
 Michael Cornish / Roland Cornish    Beaumont Cornish Limited            Tel: +44 (0) 20 7628 3396

                                     (Nominated Adviser)
 John More/Toby Gibbs                Shore Capital Stockbrokers Limited  Tel: +44 (0) 20 7408 4090
 Matthew Bonner                      EAS Advisors LLC                    Tel: +1 646 495 2225

 

Glossary of Technical Terms

 "DFS"  Definitive Feasibility Study.

 

Notes to Editors

Premier African Minerals Limited (AIM: PREM) is a multi-commodity mining and
natural resource development company focused on Southern Africa with its RHA
Tungsten and Zulu Lithium projects in Zimbabwe.

 

The Company has a diverse portfolio of projects, which include tungsten, rare
earth elements, lithium and tantalum in Zimbabwe and lithium and gold in
Mozambique, encompassing brownfield projects with near-term production
potential to grass-roots exploration. The Company has accepted a share offer
by Vortex Limited ("Vortex") for the exchange of Premier's entire 4.8 per cent
interest in Circum Minerals Limited ("Circum"), the owners of the Danakil
Potash Project in Ethiopia, for a 13.1 per cent interest in the enlarged share
capital of Vortex. Vortex has an interest of 36.7 per cent in Circum.

 

In addition, the Company holds a 19 per cent interest in MN Holdings Limited,
the operator of the Otjozondu Manganese Mining Project in Namibia.

Ends

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