The boards of KimCor and Dwyka Resources have announced that KimCor has conditionally agreed to acquire the entire issued share capital of Dwyka Resources’ diamond subsidiary DDH, a holding company registered in Mauritius, whose subsidiaries are principally engaged in the exploration and mining of diamonds in South Africa and Tanzania.
By reason of the size of DDH in relation to KimCor, the Acquisition is classified as a reverse takeover under the AIM Rules. The AIM Rules require that completion of the Acquisition is subject to the prior approval of KimCor shareholders, which will be sought at an extraordinary general meeting of the company, and the publication of an AIM admission document, which was posted to KimCor shareholders on August 21.
The consideration payable in respect of the Acquisition is to be satisfied through the issue of 134,383,718 New Ordinary Shares, valuing all of the ordinary shares of DDH at approximately £8.73 million at the Placing Price and £9.74 million based on the closing middle market price of £0.0725 per Ordinary Share on August 20. The consideration shares will represent 50.09%of the Enlarged Share Capital following Admission.
The Board of KimCor is to be strengthened through the appointment of Melissa Sturgess and Cedric Bredenkamp as Chairman and Managing Director respectively, conditional upon Completion.
Martyn Churchouse, CEO of KimCor, commented: “The Acquisition provides the enlarged KimCor Group with a diversified asset base of producing mines which has the potential to generate sustainable production of over 200,000 ct/y. A number of capital projects will be completed using the funds raised to expand production capacity and improve efficiency at the newly acquired mines as well as at the Bellsbank operations.
“The Acquisition is an important step in the medium to long-term strategic growth plan of KimCor, and we believe it positions the Company to capitalise on future consolidation in the diamond sector and on further opportunities that are likely to present themselves.”