REG - Constance Iron Ltd - Intention to Float on London Stock Exchange

Rio TintoAnnouncement

30/01/2023 08:15

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RNS Number : 1763O  Constance Iron Limited  30 January 2023

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR
INDIRECTLY, IN OR INTO OR FROM AUSTRALIA, CANADA, JAPAN OR THE UNITED STATES
OR ANY OTHER JURISDICTION WHERE IT WOULD BE UNLAWFUL TO RELEASE, PUBLISH OR
DISTRIBUTE THIS ANNOUNCEMENT.

This announcement is not a prospectus and not an offer of shares for sale in
any jurisdiction, including in or into Australia, Canada, Japan or the United
States.

The content of this promotion has not been approved by an authorised person
within the meaning of the Financial Services and Markets Act 2000.  Reliance
on this promotion for the purpose of engaging in any investment activity may
expose an individual to a significant risk of losing all of the property or
other assets invested.

Neither this announcement, nor anything contained herein, nor anything
contained in the Registration Document referred to herein shall form the basis
of, or be relied upon in connection with, any offer or commitment whatsoever
in any jurisdiction. Investors should not subscribe for or purchase any shares
referred to in this announcement or in the Registration Document except solely
on the basis of the information contained in a prospectus in its final form
(together with any supplementary prospectus, if relevant, the "Prospectus"),
including the risk factors set out therein, that may be published by Constance
Iron Limited ("Constance Iron" or the "Company") in due course in connection
with a possible placing of ordinary shares in the capital of the Company (the
"Shares") and the possible admission of such Shares to the standard listing
segment of the Official List of the Financial Conduct Authority (the "FCA")
and to trading on the main market of London Stock Exchange plc ("Admission").
A copy of any Prospectus published by the Company will, if published, be
available for inspection on the Company's website at
https://www.constanceiron.com, subject to certain access restrictions.

30 January 2023

Constance Iron Limited

Announcement of Intention to Publish a Registration Document and
Expected Intention to Float on the London Stock Exchange

Constance Iron Limited ("Constance Iron" or the "Company"), whose principal
activities will be the development and production of predominantly magnetite
iron ore projects in Australia, announces that it is considering an initial
public offering (the "IPO" or the "Offer") and that it intends to publish
today a registration document (the "Registration Document"). Constance Iron is
considering applying for admission of the Shares to the standard listing
segment of the Official List of the FCA and to trading on the Main Market of
the London Stock Exchange ("Admission").

Constance Iron Highlights:

·    Constance Iron has a 65% net profit interest in the Norseman Iron Ore
Project ("Norseman"), Western Australia, through a funding and offtake
agreement, and a 100% interest in the Constance Range Iron Ore Project
("Constance Range"), Queensland, Australia.

·    The Norseman iron ore resource is predominantly magnetite, recognised
in the industry as "green iron ore" due to its lower impurities and its
exothermic reaction at the blast furnace stage requiring lower fuel
consumption than other iron ores, thus saving energy, emissions, and costs for
steel smelters.

·    Norseman has a number of advantages over other iron ore development
projects, which include:

o  Near-term production - According to management's best estimates, expected
to begin in FYQ1 2024 1  (#_ftn1) (being calendar Q3 2023)

o  Potential premium product - Norseman will initially produce around a
targeted 62-63% Fe fines product through the dry process, and then a targeted
66% Fe product through a wet beneficiation process. Magnetite ore benefits
from, amongst other aspects, lower impurities and exothermic properties, when
compared to traditional hematite ores.

o  Existing infrastructure - Norseman is conveniently located in proximity to
critical infrastructure, including electricity, road, rail and a deep-water
port facility at Esperance for export to prospective South-East Asian
customers.

o  Target customer base - MOUs being negotiated with identified target
customers.

•     The Company's directors believe that Norseman has an opportunity
for exploration upside through a planned pipeline of exploration. The target
ore body is more than 27kms of strike length covered over a width of 1.8kms.
The Norseman Competent Person's Report ("CPR"), by HGS Australia, has
identified:

o  The Norseman Iron Ore Project to have an exploration potential of between
362 - 938 million tonnes magnetite, at an average global resource grade of 35%
Fe;

o  Given the 35% head grade and Davis Tube Recovery results from the Norseman
Iron Ore Project and adjacent projects as well as anticipated production
grades from other magnetite projects in Australia, in the opinion of the
Company the Norseman Iron Ore Project is capable of producing up to 66% Fe
high-grade concentrate via a wet beneficiation process.  The Norseman Iron
Ore Project's life of mine has been modelled out to an estimated 30 years on
the current resource.

·    Constance Range is an iron ore project 100% owned by the Company and
situated northwest of Mount Isa in Queensland, Australia. The project,
previously explored by BHP, has a previously categorised JORC 2004 "Inferred
Resource" of approx. 6.1mt at 39.9% Fe (Deposit D) and approx. 236mt at 53.2%
Fe (Deposit A), of which approx. 11.4mt is considered Direct Shipping Ore
(DSO) with a 57.2% grade.

·    Constance Iron is led by Chief Executive Officer David Mckenzie, with
30 years in the mining industry including senior management positions at BHP
and Rio Tinto. The Constance Iron Board includes Adam Giles, Chairman, who was
the 10(th) Chief Minister of Australia's Northern Territory, and Non-Executive
Directors Kenn MacMillan (JB Were, Merrill Lynch, UBS Wealth Management),
Christopher Wellesley (UK investment banker), and Susan Prior (20 years'
accounting experience, including her current appointment as CFO of a natural
resources company).

 

David Mckenzie, Chief Executive of Constance Iron, said:

"The IPO of Constance Iron on the London Stock Exchange provides investors
with exposure to a developer of targeted high-grade, low-impurity magnetite
iron ore, an essential component to the production of 'Green Steel', which is
necessary as the world continues to develop and urbanise in an environment
increasingly seeking reduced emissions. Our proximity to existing
infrastructure and plan to use dry magnetic separation means that we have an
initial low-capex model with a short development timeline. We believe that
these advantages when combined with a product, for which we expect there to be
high global demand, will enable us to generate returns for shareholders
following the IPO."

 

For further information please contact:

Analyst and Media enquiries:

Bobby Morse/ Oonagh Reidy

Buchanan

Tel: +44 (0)20 7466 5000 or constance@buchanan.uk.com
(mailto:constance@buchanan.uk.com)

Investor enquiries:

Robert Emmet

Optiva Securities Limited

Tel: +44 (0)20 3137 1902 or Robert.Emmet@optivasecurities.com
(mailto:Robert.Emmet@optivasecurities.com)

 

Potential Fundraising Highlights:

Should Constance Iron proceed with an IPO, the current expectation is that:

 ·    There will be a placing of the Company's shares by Optiva Securities
 Limited ("Optiva") that will become unconditional upon Admission.  The
 Company is targeting to raise gross proceeds of at least £60 million.
 ·    The net proceeds of the placing (if any) will be primarily utilised
 to fund the exploration and development to production of the Norseman Iron Ore
 Project and exploration of the Constance Range Iron Ore Project.

 ·    The details of the placing, together with any changes to the
 Company's corporate governance arrangements and any material developments
 subsequent to the publication of the Registration Document will be disclosed
 in the Prospectus, if and when published.

A copy of the Registration Document will be uploaded to the National Storage
Mechanism and will be available for inspection at
https://data.fca.org.uk/#/nsm/nationalstoragemechanism
(https://data.fca.org.uk/#/nsm/nationalstoragemechanism) once approved by the
FCA. A copy of the Registration Document will also be available online at
https://www.constanceiron.com, subject to certain access restrictions.

 

Investment Highlights:

A.  Iron Ore Market

Iron ore is the fourth most abundant element in the earth's crust, making up
~5%, but the zones in which high-quality and economical quantities exist are
finite. Western Australia and Queensland, as states of Australia, are globally
recognised as environments that are safe and conducive for mining to thrive.
According to 2020 OEC data, iron ore was the 13(th) most traded product, with
a total trade of US$141 billion. Australia is the largest exporter of iron ore
globally with a 56.4% market share in 2020 valued at US$79.6 billion. China
was the world's largest importer in 2020, importing US$99 billion, or 70.2% of
the market.  Japan, South Korea, Malaysia and Singapore complete the top five
importers with a combined share, with China, of 83.5% of the world's iron ore
market.

The primary use of iron ore is in the production of steel. Steel being a
critical resource required across a multitude of industries such as
construction, transport, home appliances, and infrastructure, such as wind
turbines. As a result, the price of iron ore is high; in 2021 the price of 62%
Fe dry metric ton units averaged at USA$160. Although the price weakened in
2022, the average daily price for 2022 remained high, at USA$121.48/t, which
is still above the historical 10-year average of USA$97.40/t for 62% fines
CFR.

It is important to appreciate that iron ores can form from several different
minerals but the most common are hematite and magnetite. Historically, miners
have targeted production of hematite due to its naturally high grades, which
required limited processing, resulting in a low-cost product referred to as
direct shipping ore (DSO). However, the primary issue with hematite is that it
carries a lot of impurities requiring high levels of coking coal in which to
produce a quality steel product.

Hematite

Hematite is currently a favoured iron ore due to naturally high grades
enabling DSO with minimal processing. However, the quality of DSO has declined
over time as orebodies are exhausted and replacements remain undiscovered.

Magnetite

Magnetite is a relatively low-grade ore body that, unlike hematite, is very
well suited to beneficiating (processing) through a dry-magnetic or wet
beneficiation process to upgrade the ore into a saleable product. While the
cost of processing is higher, the final product is of a higher purity than
hematite DSO, despite similar Fe content, and commands a higher price in the
market. This is due to higher purity products requiring less metallurgical
coal to process, thus reducing emissions, and improving margins for steel
mills.

 

B.  Company Strategy

Due to the skill set of the Board and the Company's advisers, the strategy has
been to acquire discrete, viable projects near operating or planned processing
facilities.  Today Constance Iron boasts a diverse portfolio of iron ore
project areas, within the North Queensland region and in the Norseman region
of Western Australia. The primary strategy will now pivot to developing
production at the Norseman Project to fund further exploration at Norseman and
Constance Range.

Initially, the Company's immediate strategy is to bring the Norseman Iron Ore
Project to production via a dry magnetic separation process. The requirements
to achieve this critical milestone will begin in Q3 FY23 with geological
mapping, resource drilling, logistics upgrades, pit design and engineering,
and the purchase and construction of the dry magnetic separators. The
commissioning of the dry magnetic separation plant is estimated to occur in Q4
FY23, followed by initial open pit mining production in Q1 FY24, and will be
the beneficiation method for the first 3 years of production. Over that 3-year
period, management are targeting an average annual production rate of between
700k to 750k tonnes per annum of a targeted 62-63% Fe fines product with an
estimated total cost of A$66/t. The timeline for this strategy of enabling
early production provides an opportunity for the Company to generate initial
cash flows within 12 months following admission on the LSE.

Stage 2 at the Norseman Iron Ore Project, which will run in conjunction with
Stage 1, will be the approval, engineering, design, and commissioning of a wet
beneficiation plant. In the opinion of the Company, the wet plant is capable
of producing a high-grade iron ore concentrate with a targeted grade of up to
66% Fe and capacity is estimated to be 2-3mt/pa. Despite an estimated
A$150-A$180m capex and higher processing cost of an approx. A$83/t, the
product will normally command a premium in the marketplace. As a comparison,
in FY22 (year end March 31, 2022) Champion Iron Ltd (ASX:CIA) produced a 66.2%
Fe iron ore concentrate which sold for USA$181.1/dmt. This compares to the
average 62% Fe Platts price of US$153.6/t over the same period.

Continually, in parallel with activities at the Norseman Project, the Company
will initiate a new drilling program at the Constance Range Iron Ore Project
to bring the mineral resource to JORC 2012 compliance. This is the first step
in a long-term goal of developing the asset to production.

Key dependencies of the business model outlined above include:

·                successful completion of the Placing;

·                the achievement of technical and commercial
success of its exploration programme;

·                grant of mining licenses to the Company
pursuant to the Tenement Applications at Constance Range; and

·                all necessary licences and regulatory
approvals being secured and maintained.

 

C.  Norseman Iron Ore Project Funding and Offtake Agreement (65% Economic
Interest)

In January 2022, Constance Iron signed a non-binding Heads of Agreement with
Central Norseman Gold Corporation and Pangolin Resources in relation to an
off-take arrangement and funding for its iron ore at the Norseman Project.
Following this, in June 2022 a binding long-form agreement (the "Norseman
Agreement") and, in December 2022, a related side letter, were signed between
the same parties. Key terms and details of the agreement include:

1. Offtake terms:

a. Constance to purchase the first 400 million drilled metric tonnes of Iron
Ore mined (comprising 5 tranches);

b. On or shortly following Constance Iron's Shares being accepted to the
Official List and to trading on the Main Market of the London Stock Exchange,
it will prepay the sellers under the Norseman Agreement (the "Tulla Parties")
A$20 million cash and issue £7.5 million in Constance Iron Shares at the IPO
issue price to the Tulla Parties (or their nominee) for the right to acquire
an initial tranche of 200 million metric dry tonnes of iron ore (on a
non-refundable basis). Thereafter, if and to the extent mineral reserves in
excess of these 200 million tonnes are identified, Constance Iron will prepay
for up to a further 4 tranches of 50 million tonne (in cash or equity in
Constance at the option of Central Norseman Gold Corporation Pty Ltd and
Pangolin Resources Pty Ltd) based on an agreed price per metric tonne (varying
between A$0.25 and A$0.45) ("Base Quantity");

c. In addition to the prepaid tranches in respect of the Base Quantity, if and
when such tonnages are mined and delivered to Constance Iron, Constance Iron
will pay additional deferred consideration to the Tulla Parties in respect of
such tonnages (calculated at an amount of 35% of the net proceeds of the
on-sale of such product); and

d. Within the first 10 years, if and to the extent reserves are in excess of
the Base Quantity are identified, Constance Iron has the right to purchase
additional quantities of Iron Ore in tranches of 50 million tonnes at a price
to be determined at the time ("Additional Quantities"). In addition to this
prepayment, if and when such Additional Quantities are mined and delivered to
Constance Iron, Constance Iron must pay deferred consideration to the Tulla
Parties in respect of such Additional Quantities (calculated at an amount of
35% of the net proceeds of the on-sale of such product unless the Tulla
Parties elect not to contribute funding in which case it will be at 10% of the
net proceeds). After this 10-year period, Constance Iron's right to purchase
Additional Quantities is subject to the agreement of the Parties.

2. Funding:

a. Constance Iron is obliged to fund the first A$42 million of costs incurred
in respect of the exploration, development, mining, and treatment of product
within the first 4 years; and

b. Otherwise, Constance Iron generally bears 65% of the costs incurred in
respect of the exploration, development, mining, treatment of product and
rehabilitation.

3. Option:

a. Within the first 10 years, if and to the extent reserves in excess of the
Base Quantity and any Additional Quantities are identified, Constance Iron has
an option to purchase all JORC categories of Iron Ore as stated in the JORC
Code in excess of the Base Quantity and any Additional Quantities acquired by
Constance Iron ("Excess Iron Ore").

b. The upfront consideration payable for the Excess Iron Ore is determined by
a valuer (and is payable, at the election of the Tulla Parties, in cash or
equity in Constance Iron). In addition to the upfront consideration for the
Excess Iron Ore, when such tonnages are mined and delivered to Constance Iron,
Constance Iron will pay additional deferred consideration to the Tulla Parties
in respect of the Excess Iron Ore (calculated at an amount of 2.5% of the
gross revenue in respect of the on-sale of such product). After this 10-year
period, Constance Iron's right to purchase Excess Iron Ore is subject to the
agreement of the Parties.

c. On and from the date that Constance Iron exercises the option (or, in the
event the option is exercised after the 10-year period and the Tulla Parties
accept Constance Iron's election) to purchase mined Excess Iron Ore, it
generally bears 100% of the costs incurred in respect of the exploration,
development, mining, treatment of product and rehabilitation.

4. Project Contractor:

a. Under the Agreement the Tulla Parties have appointed Constance Iron as the
'Project Contractor' generally responsible for managing the day-to-day
exploration, development, mining, treatment and rehabilitation activities of
the Norseman iron ore project in accordance with the mineral rights deed which
governs the rights and obligations of the Tulla Parties in connection with the
Industrial Mineral Rights on the Norseman Tenements. The Tulla Parties have
the right to remove Constance Iron from this role in prescribed circumstances
(e.g. material unremedied breach of its obligations).

D.

 

Directors

 

Adam Giles, Non-Executive Chairman (aged 49)

Adam was the 10th Chief Minister of Australia's Northern Territory and held
parliamentary office from 2008 until 2016. During his political career Adam
held the portfolios of Chief Minister, Treasury, Major Projects, Economic
Development, Indigenous Affairs, Transport and Infrastructure. Prior to
politics, Adam had a long career in developing regional economic policy for
the Australian Government including working as an economic policy adviser in
the Department of Prime Minister and Cabinet. Adam is the current Chair of
Australian Copper exploration company Locksley Resources Ltd and an
Independent Director of Norcliffe Mining Services Ltd.

Adam was appointed as a director of the Company on 7 March 2019.

Christopher Wellesley, Non-Executive Director (aged 58)

Christopher is a highly experienced banking and capital markets executive with
the board and not-for-profit expertise, comprising three decades of senior
roles within tier-one institutions in London and Hong Kong, working with
clients in the resources, energy and funds management sectors. In addition,
Christopher has an extensive network of senior, key relationships across the
UK capital markets as well as demonstrated capital raising, corporate and
financial markets expertise and a deep commitment and involvement in a range
of private philanthropic activities.

Christopher was appointed as a director of the Company on 1 July 2020.

Kenn MacMillan, Non-Executive Director (aged 54)

Kenn has over 30 years of financial services experience, spanning across
multiple blue-chip financial services companies including JBWere and Merrill
Lynch, where he headed up their Australian Private Clients business. Following
this Kenn joined UBS Wealth Management in 2004 as head of its Sydney office
and was promoted to Managing Director in 2007. Kenn MacMillan founded
MacMillan Capital, an investment and corporate advice business in January
2020. Kenn's career spans corporate advice, investment advice and
non-executive directorships and he has significant experience managing
financial services businesses and advising professional investors and
corporate clients on all aspects of their businesses including raising
capital, strategy and investment across all asset classes.

Kenn was appointed as a director of the Company on 14 April 2021

Susan Prior, Non-Executive Director (aged 52)

Susan has more than 20 years' accounting experience and is currently CFO of an
oil & gas company. As a CFO she has extensive experience in financial
management including developing monthly management reporting processes,
integration and improvement to finance functions, establishing internal
control mechanisms and financial governance, treasury management, tax
structuring and meeting regulatory obligations.

Susan has served as a CFO for oil and gas companies since 2015.  Earlier in
her career, Susan was a Director of PwC in London and a Partner at EY in New
York, where her roles centred on cross-border work with clients including
carve-out transactions, acquisitions, and capital raisings.

Susan was appointed as a director of the Company on 29 July 2022.

David McKenzie, Chief Executive Officer (aged 58)

David is an established mining professional with 30 years industry experience
across base metals and iron ore processing as well as open pit mining
operations. He has held senior management and statutory positions with
blue-chip natural resources companies such as BHPB Cannington (ASX:BHP), and
Rio Tinto West Angelas (ASX: RIO).

David served as COO from 5 April 2021 until 30 September 2021, from which
point he has served as CEO (following the termination of the previous CEO,
Stephen Woodham). David was appointed and as an executive director of the
Company on 1 July 2022.

Company Secretary

Rajesh Padmanabhan, Company Secretary

Rajesh has more than 16 years' experience in the Australian mining industry.
He has held various senior management positions, including Finance &
Commercial Manager for Aditya Birla Minerals at Mt Gordon Copper and
Management & Project Accountant for Barrick (Australia) Pty Ltd at Porgera
Mine Operations.

 

Important legal information

This announcement has been prepared by and is the sole responsibility of
Constance Iron, and has not been approved by Optiva. Optiva is acting for
Constance Iron and no one else and will not be responsible for providing the
protections afforded to clients of Optiva or for providing advice in relation
to the proposed placing to any other person. Optiva can be contacted at 118
Piccadilly, London W1J 7NW.

The information contained in this announcement is for background purposes only
and does not purport to be full or complete. No reliance may be placed by any
person for any purpose on the information contained in this announcement or
its accuracy, fairness or completeness.

This announcement is not for publication or distribution, directly or
indirectly, in or into Australia, Canada, Japan or the United States
(including its territories and possessions, any State of the United States and
the District of Columbia) or any other jurisdiction where to do so would
constitute a violation of the relevant laws of such jurisdiction. The
distribution of this announcement may be restricted by law in certain
jurisdictions and persons into whose possession any document or other
information referred to herein comes should inform themselves about and
observe any such restriction. Any failure to comply with these restrictions
may constitute a violation of the securities laws of any such jurisdiction.

This announcement does not constitute or form a part of any offer to sell or
issue, or the solicitation of any offer to purchase, subscribe for or
otherwise acquire, any securities to any person in Australia, Canada, Japan or
the United States (including its territories and possessions, any State of the
United States and the District of Columbia) or in any other jurisdiction. The
Shares have not been and will not be registered under the Securities Act, or
under the securities law of any state or other jurisdiction of the United
States, and may not be offered or sold in the United States except pursuant to
an exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act and in compliance with any applicable
securities laws of any state or other jurisdiction of the United States. The
possible placing referred to herein has not been and will not be registered
under the applicable securities laws of Australia, Canada or Japan. Subject to
certain exceptions, the Shares referred to herein may not be offered in
Australia, Canada or Japan or to, or for the account or benefit of, any
national, resident or citizen of Australia, Canada or Japan. There has not
been and will not be a public offering of the Shares in Australia, Canada,
Japan, the United States or elsewhere.

In Australia, this announcement is being distributed only to, and is directed
only at, persons who are either: (A) a "sophisticated investor" within the
meaning of section 708(8) of the Corporations Act 2001 (Cth) ("Australian
Corporations Act 2001") and, if applicable, have provided an accountant's
certificate in accordance with section 708(8)(c)(i) or (ii) of the Australian
Corporations Act 2001 and related regulations to the Company before receiving
this announcement; (B) a "professional investor" within the meaning of section
708(11) of the Australian Corporations Act 2001; or (C) a person associated
with the Company under section 708(12) of the Australian Corporations Act
2001. This announcement does not constitute, or purport to include the
information required of a disclosure document under the Australian
Corporations Act 2001 and will not be lodged with the Australian Securities
and Investments Commission. In making an investment decision, prospective
investors must rely on their own examination of the merits and risks involved.
The Company is not licensed in Australia to provide financial product advice
in relation to the Shares.

In the United Kingdom, this announcement is being distributed only to, and is
directed only at, persons who: (A) are "qualified investors" within the
meaning of Article 2(e) of the Prospectus Regulation (Regulation (EU)
2017/1129) as it forms part of UK law by virtue of the European Union
(Withdrawal) Act 2018, as amended and supplemented; and (B) (i) are
"investment professionals" specified in Article 19(5) of the Financial
Services and Markets Act (Financial Promotion) Order 2005 (the "Order") or
(ii) high net worth entities falling within Article 49(2)(a) to (d) of the
Order or (iii) are other persons to whom it may otherwise lawfully be
communicated (all such persons together being referred to as "Relevant
Persons").  In member states of the European Economic Area (the "EEA"), this
announcement is addressed only to, and directed only at, persons in who are
"qualified investors" within the meaning of Article 2(e) of the Prospectus
Regulation (Regulation ((EU) 2017/1129) ("Qualified Investors"). This
announcement must not be acted on or relied on (i) in the United Kingdom, by
persons who are not Relevant Persons, and (ii) in any member state of the EEA,
by persons who are not Qualified Investors. Any investment or investment
activity to which this announcement relates is available only to: (i) in the
United Kingdom, Relevant Persons; and (ii) in any member state of the EEA,
Qualified Investors, and will be engaged in only with such persons.

This announcement may include statements that are, or may be deemed to be,
"forward-looking statements". These forward-looking statements may be
identified by the use of forward-looking terminology, including the terms
"believes", "estimates", "plans", "projects", "anticipates", "expects",
"intends", "may", "will" or "should" or, in each case, their negative or other
variations or comparable terminology, or by discussions of strategy, plans,
objectives, goals, future events or intentions. Forward-looking statements may
and often do differ materially from actual results. Any forward-looking
statements reflect the Company's current view with respect to future events
and are subject to risks relating to future events and other risks,
uncertainties and assumptions relating to the Company's business, results of
operations, financial position, liquidity, prospects, growth and strategies.
Forward-looking statements speak only as of the date they are made.

Each of the Company and Optiva and their respective affiliates as defined
under Rule 501(b) of Regulation D under the Securities Act ("affiliates"),
expressly disclaims any obligation or undertaking to update, review or revise
any forward-looking statement contained in this announcement whether as a
result of new information, future developments or otherwise.

Any purchase of Shares in the possible placing should be made solely on the
basis of information contained in the Prospectus which may be issued by the
Company in connection with the possible placing. The information in this
announcement is subject to change. Before subscribing for or purchasing any
Shares, persons viewing this announcement should ensure that they fully
understand and accept the risks which will be set out in the Prospectus, if
published. No reliance may be placed for any purpose on the information
contained in this announcement or its accuracy or completeness. Neither this
announcement, nor anything contained in the Registration Document referred to
herein, shall form the basis of or constitute any offer or invitation to sell
or issue, or any solicitation of any offer to purchase or subscribe for any
Shares or any other securities nor shall it (or any part of it) or the fact of
its distribution, form the basis of, or be relied on in connection with, any
contract therefor.

The Company may decide not to go ahead with the potential IPO and there is
therefore no guarantee that a Prospectus will be published, the placing will
complete or that Admission will occur. You should not base any financial
decision on this announcement. Acquiring investments to which this
announcement relates may expose an investor to a significant risk of losing
all of the amount invested.

Persons considering making investments should consult an authorised person
specialising in advising on such investments. Neither this announcement, nor
the Registration Document referred to herein, constitutes a recommendation
concerning the possible placing. The value of shares can decrease as well as
increase. Potential investors should consult a professional advisor as to the
suitability of the possible placing for the person concerned.

Nothing contained herein constitutes or should be construed as (i) investment,
tax, financial, accounting or legal advice; (ii) a representation that any
investment or strategy is suitable or appropriate to your individual
circumstances; or (iii) a personal recommendation to you.

Optiva or any of its respective affiliates or any of its or its respective
affiliates' directors, officers, employees, advisers or agents accepts any
responsibility or liability whatsoever for/or makes any representation or
warranty, express or implied, as to the truth, accuracy or completeness of the
information in this announcement (or whether any information has been omitted
from the announcement) or any other information relating to the Company, its
subsidiaries or associated companies, whether written, oral or in a visual or
electronic form, and howsoever transmitted or made available or for any loss
howsoever arising from any use of the announcement or its contents or
otherwise arising in connection therewith.

Optiva is acting exclusively for the Company and no one else in connection
with the possible placing. It will not regard any other person (whether or not
a recipient of this document) as its respective clients in relation to the
possible placing and will not be responsible to anyone other than the Company
for providing the protections afforded to their respective clients, nor for
providing advice in relation to the possible placing, the contents of this
announcement or any transaction, arrangement or other matter referred to in
this announcement or in the Registration Document referred to herein.

The Registration Document, which will be made available to the public in
accordance with the Prospectus Regulation Rules of the FCA, has been prepared
for the purpose of providing information on the Company and may be combined
with a securities note and summary to form a Prospectus in accordance with the
Prospectus Regulation Rules of the FCA. However, the Registration Document,
where not combined with the securities note and summary to form a Prospectus
does not constitute a Prospectus, nor an offer or invitation to sell or issue,
or a solicitation of an offer or invitation to purchase or subscribe for, any
securities in the Company, in any jurisdiction, including in Australia, the
United States, Canada, Japan or in any jurisdiction to whom or in which such
offer or solicitation is unlawful.

Optiva is authorised and regulated by the Financial Conduct Authority in the
United Kingdom.

Unless otherwise indicated, market, industry and competitive position data are
estimates (and accordingly, approximate) and should be treated with caution.
Such information has not been audited or independently verified, nor has the
Company ascertained the underlying economic assumptions relied upon therein.

Certain data in this announcement, including financial, statistical, and
operating information has been rounded. As a result of the rounding, the
totals of data presented in this announcement may vary slightly from the
actual arithmetic totals of such data. Percentages in tables may have been
rounded and accordingly may not add up to 100%.

For the avoidance of doubt, the contents of the Company's website is not
incorporated by reference into, and do not form part of, this announcement.

 

 1  (#_ftnref1) Fiscal Year End June 30

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