By Dipo Olowookere
About N20 billion is needed by Japaul Gold and Ventures Plc for the acquisition of H&H Mines Limited and Covenant Gems and Gold Minerals Limited.
A statement signed by the company secretary, Mr Michael Edeko, disclosed that part of the fresh funds would be used by the mining firm to establish a gold refinery.
The organisation explained in the notice filed to the Nigerian Exchange (NGX) Limited that the additional capital would enable it to reposition itself as “a market leader in the mining sector.”
Japual, which trades its stocks at the country’s main bourse, further disclosed that the new funding would be sourced from “identified investors” through special placements.
The company is looking to offer these investors a total of 8 billion ordinary shares at a unit price of N2.50. At the moment, an application has been submitted to the Securities and Exchange Commission (SEC) for approval.
When authorised by SEC to go ahead with the special placements and the funds secured, Japaul said it would take a 50 per cent stake in H&H Mines and a 100 per cent stake in Covenant Gems.
According to the firm, feasibility studies have been conducted to determine the value the acquisitions would give to the company and shareholders at large.
“This is to notify the Nigerian Exchange (NGX) Limited and the investing public that following the company’s board resolution dated June 14, 2023, the company has applied to the Securities and Exchange Commission (SEC) to raise additional capital in the sum of N20 billion through special placements with identified investors.
“The proceeds of the placements shall be applied primarily to finance the expansion of the company’s minefields through the acquisitions of a 50 per cent stake in H&H Mines and a 100 per cent acquisition of Covenant Gems and Gold Minerals Limited in Eti-Oni, Atakumosa Local Government, Osun State (assets for shares exchange) and the establishment of a gold refinery to maximise value.
“The transaction is aimed at reinforcing the primary business of the company as a mining-focused enterprise and repositioning it as a market leader in the mining sector.
“The mining lease of H&H Mines Limited based on the Competent Persons Report (CPR) confirms a gold reserve in excess of 20,000kg, while Covenant Gems and Gold Minerals Limited minefields contain copper and mineable gold with 97 per cent,” the disclosure said.
