REG - Resolute Mining Ltd - Institutional Offer Done Underwriting up to A$164m

Resolute MiningAnnouncement

14/11/2022 07:01

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RNS Number : 2629G  Resolute Mining Limited  14 November 2022

NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES

14 November 2022

Institutional Offer Complete

Underwriting increased to A$164m

Highlights

·  Strong demand from high-quality, eligible existing and new domestic and
international investors resulted in upsizing of underwritten component of the
Equity Raising from A$140m to A$164m

·   Successful completion of the bookbuild for the Placement and
Institutional Entitlement Offer to raise approximately A$96m

·    Cornerstone support of A$55m received by high quality North American
institutional investor Condire, resulting in a pro forma shareholding of up to
16.2% 1 

·    Proceeds to strengthen the balance sheet and provide a financial
platform for growth

·    Retail Entitlement Offer to raise up to A$104 million (A$68 million
of which is underwritten) opens on Thursday, 17 November 2022, and is expected
to close at 7.00 pm (Sydney time) on Monday, 5 December 2022

·  Equity Raising provides refreshed management team with the financial
flexibility to continue to execute on demonstrated operational turnaround

 

Resolute Mining Limited (ASX/LSE: RSG, Resolute or the Company) is pleased to
announce that it has successfully completed the bookbuild for the
institutional placement (Placement) and the institutional component
(Institutional Entitlement Offer, together with the Placement the
Institutional Offer) of the 1-for-1.11 accelerated non-renounceable
entitlement offer (Entitlement Offer) (together the Equity Raising or Offer),
as announced on 10 November 2022.

The Placement raised approximately A$41 million through the issue of
approximately 258 million new fully paid ordinary shares in the Company (New
Shares) at an offer price of A$0.16 per New Share (Offer Price). The
Institutional Entitlement Offer and shortfall bookbuild for entitlements not
taken up (Institutional Shortfall Bookbuild) raised approximately A$55 million
through the issue of approximately 342 million New Shares at the Offer Price.

Resolute received significant demand during the bookbuild for the Placement,
Institutional Shortfall Bookbuild and the Institutional Entitlement Offer from
high-quality, eligible existing and new domestic and international
institutional investors. Following this strong demand, the underwritten
component of the Equity Raising has been increased from A$140 million to A$164
million.  The proceeds of A$164 million will be applied as follows: A$144
million to reduce net debt and A$20 million to fund general working capital,
the costs of the equity raising and to support the Company's Syama North
expansion plan.

The Equity Raising was anchored by a new international investor, Condire
Management, LP (Condire). In consideration of this strong level of support,
the Company has offered Condire the right to appoint a nominee to the board of
Resolute, whilst their shareholding remains above 15%. Condire have advised
they do not intend to accept this offer at the current time.

Under the retail component of the Entitlement Offer (Retail Entitlement
Offer), A$68 million is underwritten, however in the event the retail offer is
fully subscribed, up to an additional A$36 million can be raised. These
proceeds, in conjunction with cash reserves and future free cash flow, would
be used to further repay debt, and to support the Company's Syama North
expansion plan.

Post Equity Raising, net debt will be reduced from US$156 million at 30
September 2022, to approximately US$55 million 2 .  The 2023 repayments under
the Company's Syndicated Loan Facility of US$90 million can now be met from
the proceeds of the Equity Raising.

Terry Holohan, CEO and Managing Director commented:

"We are delighted by the strong support the Company has received for the
Equity Raising from both local and international institutions, including
several new 'Tier 1' institutions, all of whom share our exciting vision for
the Company. This strong support reflects the confidence in Resolute's
transition to a sustainable gold producer and will allow the Company to
de-risk its balance sheet. The Company is now positioned to pursue a new open
pit operation at Syama North, together with low capital expansion options for
the Sulphide circuit and continue to systematically grow."

 

Completion of the Placement and Institutional Entitlement Offer

The Placement comprises the issue of approximately 258 million New Shares to
raise approximately A$41 million, and approximately 342 million New Shares
under the Institutional Entitlement Offer and Institutional Shortfall
Bookbuild to raise approximately A$55 million.

The New Shares subscribed for under the Placement, Institutional Shortfall
Bookbuild and the Institutional Entitlement Offer are expected to settle on
Thursday 17 November 2022, with allotment and normal trading on ASX to
commence on Friday 18 November 2022. New Shares issued will rank pari passu
with existing fully paid ordinary shares in Resolute on issue.

 

Retail Entitlement Offer

The Retail Entitlement Offer of approximately A$105 million, which is
underwritten to A$68 million, is expected to open on Thursday, 17 November
2022 and close at 7.00 pm (Sydney time) on Monday, 5 December 2022 (unless
extended).

Eligible retail shareholders with a registered address in Australia, New
Zealand or Bermuda, as at 7:00 pm (Sydney time) on 14 November 2022 (Record
Date), (Eligible Retail Shareholders) will be invited to participate in the
Retail Entitlement Offer at the Offer Price. Eligible Retail Shareholders will
be able to subscribe for 1 New Share for every 1.11 Resolute shares held as at
the Record Date.  The Retail Entitlement Offer includes an oversubscription
facility, pursuant to which Eligible Retail Shareholders who take up all of
their entitlement (and who are not a related party of Resolute), may apply for
up to 50% of their entitlement, in addition to their entitlement, as
additional New Shares (subject to scale back).

Further information will be provided to Eligible Retail Shareholders in a
booklet (Retail Offer Booklet) expected to be issued on 17 November 2022 and
lodged with ASX on that date. Details on how to access the Retail Offer
Booklet will be sent to eligible retail shareholders on Thursday, 17 November
2022.

In deciding whether to participate in the Retail Entitlement Offer, Eligible
Retail Shareholders should carefully read the Retail Offer Booklet. The Retail
Offer Booklet and personalised Entitlement Form will contain instructions on
how to apply for the Retail Entitlement Offer. Acceptances and payments under
the Retail Entitlement Offer must be received by no later than 7.00 pm (Sydney
time) on Monday, 5 December 2022 (unless the Retail Entitlement Offer is
extended).

 

Advisors

Canaccord Genuity (Australia) Limited and Sprott Capital Partners LP are
acting as Joint Lead Managers, Underwriters & Bookrunners. Joh. Berenberg,
Gossler & Co. KG and Euroz Hartleys Limited are acting as Co-Managers.

Treadstone Resource Partners are acting as strategic and financial advisor and
Allen & Overy are acting as legal advisor to Resolute in Australia and the
United Kingdom.

 

Additional Information

Further information concerning the Equity Raising is contained in the Resolute
Investor Presentation released to the ASX and LSE on 10 November 2022 which is
available on the ASX website
(https://www2.asx.com.au/markets/trade-our-cash-market/announcements.rsg) .
Nothing contained in this announcement constitutes investment, legal, tax or
other advice. You should seek appropriate professional advice before making
any investment decision.  Shareholders should note the subsequent changes to
the underwritten amount of the Offer and the use of proceeds as described in
this announcement.

 

Disclaimer

This announcement has been prepared for publication in Australia and may not
be released or distributed in the United States. This announcement does not
constitute an offer to sell, or a solicitation of an offer to buy, any
securities in the United States or any other jurisdiction. The entitlements
and New Shares referred to in this announcement have not been, and will not
be, registered under the US Securities Act of 1933 (US Securities Act) or the
securities laws of any state or other jurisdiction of the United States, and
the entitlements may not be taken up by, and the New Shares may not be offered
or sold to, any person in the United States except pursuant to an exemption
from, or in a transaction not subject to, the registration requirements of the
US Securities Act and any other applicable securities laws of any state or
other jurisdiction of the United States. The Company does not intend to
register any portion of the Offer under the US Securities Act or to conduct a
public offering in the United States.

The release, publication, or distribution of this announcement (including in
electronic copy) outside Australia may be restricted by law. If you come into
possession of this announcement, you should observe such restrictions and
should seek your own advice on such restrictions. Any non-compliance with
these restrictions may contravene applicable securities laws.

General

In addition, this announcement is subject to the same "Important Notice and
Disclaimer" as appears on slides 2 to 7 of the Investor Presentation with any
necessary contextual changes.

 

Cautionary Statement about Forward-Looking Statements

This announcement contains certain "forward-looking statements" including
statements regarding our intent, belief, or current expectations with respect
to Resolute's business and operations, market conditions, results of
operations and financial condition, and risk management practices. The words
"likely", "expect", "aim", "should", "could", "may", "anticipate", "predict",
"believe", "plan", "forecast" and other similar expressions are intended to
identify forward-looking statements. Indications of, and guidance on, future
earnings, anticipated production, life of mine and financial position and
performance are also forward-looking statements. These forward-looking
statements involve known and unknown risks, uncertainties and other factors
that may cause Resolute's actual results, performance and achievements or
industry results to differ materially from any future results, performance or
achievements, or industry results, expressed or implied by these
forward-looking statements. Relevant factors may include (but are not limited
to) changes in commodity prices, foreign exchange fluctuations and general
economic conditions, increased costs and demand for production inputs, the
speculative nature of exploration and project development, including the risks
of obtaining necessary licences and permits and diminishing quantities or
grades of reserves, political and social risks, changes to the regulatory
framework within which Resolute operates or may in the future operate,
environmental conditions including extreme weather conditions, recruitment and
retention of personnel, industrial relations issues and litigation.

Forward-looking statements are based on Resolute's good faith assumptions as
to the financial, market, regulatory and other relevant environments that will
exist and affect Resolute's business and operations in the future. Resolute
does not give any assurance that the assumptions will prove to be correct.
There may be other factors that could cause actual results or events not to be
as anticipated, and many events are beyond the reasonable control of Resolute.
Readers are cautioned not to place undue reliance on forward-looking
statements, particularly in the current economic climate with the significant
volatility, uncertainty and disruption caused by the COVID-19 pandemic.
Forward-looking statements in this document speak only at the date of issue.
Except as required by applicable laws or regulations, Resolute does not
undertake any obligation to publicly update or revise any of the
forward-looking statements or to advise of any change in assumptions on which
any such statement is based. Except for statutory liability which cannot be
excluded, each of Resolute, its officers, employees and advisors expressly
disclaim any responsibility for the accuracy or completeness of the material
contained in these forward-looking statements and excludes all liability
whatsoever (including in negligence) for any loss or damage which may be
suffered by any person as a consequence of any information in forward-looking
statements or any error or omission.

 

About Resolute

Resolute Mining (ASX/LSE: RSG) is an African gold miner, developer and
explorer with more than 30 years of experience across Australia and Africa. To
date the company has produced over nine million ounces of gold. It currently
operates the Syama Gold Mine in Mali and the Mako Gold Mine in Senegal.
Resolute's gold production and cost guidance for FY2022 is 345,000oz at an
All-In Sustaining Cost of $1,425/oz.

Through all its activities, sustainability is the core value at Resolute. This
means that protecting the environment, providing a sage and productive working
environment for employees, uplifting host communities, and practicing good
corporate governance are non-negotiable priorities. Resolute's commitment to
sustainability and good corporate citizenship has been cemented through its
adoption of and adherence to the Responsible Gold Mining Principles (RGMPs).
This framework, which sets out clear expectations for consumers, investors,
and the gold supply chain as to what constitutes responsible gold mining, is
an initiative of the World Gold Council of which Resolute has been a member
since 2017. The Company is on track to reach full compliance with the RGMPs in
2023.

Contact

 Resolute                                         Public Relations

 James Virgo, GM Finance and Investor Relations   Jos Simson / Emily Moss, Tavistock

 contact@rml.com.au                               resolute@tavistock.co.uk

 +61 8 9261 6100                                  +44 207 920 3150 / +44 7788 554 035

 Australian Media                                 Corporate Broker

 Cameron Morse, FTI Consulting                    Jennifer Lee, Berenberg

 cameron.morse@fticonsulting.com                  +44 20 3753 3040

 +61 433 886 871

Authorised by Mr Terry Holohan, Managing Director and Chief Executive Officer

 1  (#_ftnref1) Condire's pro forma shareholding is calculated on the
assumption that the number of New Shares issued is based on the Underwritten
amount of A$164 million (i.e. 1.03 billion New Shares).

 2  (#_ftnref2) Estimated net debt of US$55m is after Equity Raising Costs.

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