TIDMDNK
RNS Number : 0432X
Danakali Limited
29 April 2021
Announcement Thursday, 29 April 2021
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THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS DEFINED IN
ARTICLE 7 OF THE UK VERSION OF THE MARKET ABUSE REGULATION NO.
596/2014 ("MAR") WHICH IS PART OF ENGLISH LAW BY VIRTUE OF THE
EUROPEAN UNION (WITHDRAWAL) ACT 2018, AS AMED. UPON THE PUBLICATION
OF THIS ANNOUNCEMENT, THIS INSIDE INFORMATION IS NOW CONSIDERED TO
BE IN THE PUBLIC DOMAIN.
A$20.3 Million Placement to Advance Colluli
-- Danakali successfully raises A$20.3m in a heavily
over-subscribed offer to institutional and sophisticated
Investors.
-- Early works program will commence immediately.
Danakali Limited (ASX: DNK, LSE: DNK) (Danakali or the Company)
is pleased to announce that the Company has successfully completed
a bookbuild to domestic and international institutional and
sophisticated investors to raise A$20.3 million before costs
(Placement) through the issue of 47,296,231 ordinary shares
(Placement Shares) at A$0.43 per share (equivalent to 24 pence) per
Placement Share (the Placement Price).
The proceeds of the Placement will be applied towards early
works at the Company's Colluli SOP Project, including site road
development, geotechnical optimisation, reverse osmosis plant
completion and installation, exploration camp relocation and RA
International mine camp installation. In addition, proceeds will be
used towards detailed engineering for the Project and for general
working capital requirements.
Seamus Cornelius, Executive Chairman, commented:
"We are delighted by the strong interest from new institutional
and sophisticated investors as well as the support from existing
shareholders and would like to thank them for their participation
in this heavily oversubscribed fundraise. With the completion of
this placement and subject to agreement on timing and priorities
with our partners in Eritrea, the Company can now fund key
activities which allows us to move forward immediately with the
early works at Colluli that will ensure efficient mine
construction".
Euroz Hartleys Limited is the Lead Manager and Bookrunner to the
Placement. Canaccord Genuity (Australia) Limited acted as
Co-Manager to the Placement. Shore Capital Stockbrokers Limited
acted as Danakali's sole Bookrunner and placement agent to
investors in the United Kingdom.
Placement
The allotment of 47,296,231 Placement Shares is not subject to
shareholder approval and will fall within the Company's 15%
placement capacity under ASX LR 7.1 (15,327,397 Placement Shares)
and additional 10% placement capacity under ASX LR 7.1A (31,968,834
Placement Shares).
The Placement Shares, which will rank pari passu with the
existing ordinary shares in the Company, have been conditionally
placed subject to admission to trading on the ASX (ASX Admission).
Application will be made for ASX Admission of the Placement Shares
and for the Placement Shares to be admitted to the Official List of
the FCA (Standard Segment) and to trading on the London Stock
Exchange's Main Market (LSE Admission). ASX Admission and LSE
Admission are both expected to occur on Thursday, 6 May 2021.
Strong Board and Management Support
In addition to the Placement Danakali's Directors have indicated
their intention to collectively subscribe for 1,080,000 shares to
raise $464,400 on the same terms as the Placement (Director
Placement Shares). Resolutions to approve participation by
Directors will be put to shareholders at a general meeting planned
to be held in or around June 2021.
In addition to these Directors, certain persons discharging
managerial responsibilities (PDMR) and persons closely associated
(PCA) with a PDMR have indicated their intention to subscribe for
269,768 shares to raise $116,000 on the same terms as the Placement
(Other PDMR/PCA Shares). Such participation is to be confirmed once
the Company has released its quarterly results for the period ended
31 March 2021 (expected to be released on or around 30 April 2021)
and is therefore out of the "closed period" for trading.
Total Voting Rights
Following the issue of the Placement Shares, the Company will
have 366,984,578 ordinary shares on issue, all of which have the
right to one vote. The Company does not hold any Ordinary Shares in
treasury. Therefore, the total number of voting rights in the
Company will be 366,984,578 which figure may be used by
shareholders or other persons as the denominator for the
calculations by which they will determine if they are required to
notify their interest in, or a change to their interest in the
Company.
A completed Appendix 3B in respect of the proposed issue of
Placement Shares has been lodged together with this announcement
and is available at
https://www.asx.com.au/asxpdf/20210429/pdf/44vzqcb9b8djml.pdf
This Announcement is authorised for release by the Board of
Danakali Limited.
For more information, please contact:
Danakali
Seamus Cornelius Mark Riseley
Executive Chairman Head of Corporate Development
+61 8 6266 8368 +61 8 6266 8368
Visit the Company's website: www.danakali.com
Follow Danakali on LinkedIn:
www.linkedin.com/company/danakali-limited
Subscribe to Danakali on YouTube:
www.youtube.com/channel/UChGKN4-M4lOvPKxs9b-IJvw
About Danakali
Danakali Limited (ASX: DNK, LSE: DNK) (Danakali, or the Company)
is an ASX- and LSE-listed potash company focused on the development
of the Colluli Sulphate of Potash Project (Colluli or the Project).
The Project is 100% owned by the Colluli Mining Share Company
(CMSC), a 50:50 joint venture between Danakali and the Eritrean
National Mining Corporation (ENAMCO).
The Project is located in the Danakil Depression region of
Eritrea, East Africa, and is 75km from the Red Sea coast, making it
one of the most accessible potash deposits globally. Mineralisation
within the Colluli resource commences at just 16m, making it the
world's shallowest known potash deposit. The resource is amenable
to open cut mining, which allows higher overall resource recovery
to be achieved, is generally safer than underground mining, and is
highly advantageous for modular growth.
The Company has completed a Front End Engineering Design (FEED)
for the production of potassium sulphate, otherwise known as
Sulphate of Potash or SOP. SOP is a chloride free, specialty
fertiliser which carries a substantial price premium relative to
the more common potash type; potassium chloride (or MOP). Economic
resources for production of SOP are geologically scarce. The unique
composition of the Colluli resource favours low energy input, high
potassium yield conversion to SOP using commercially proven
technology. One of the key advantages of the resource is that the
salts are present in solid form (in contrast with production of SOP
from brines) which reduces infrastructure costs and substantially
reduces the time required to achieve full production capacity.
The resource is favourably positioned to supply the world's
fastest growing markets. A binding take-or-pay offtake agreement
has been confirmed with EuroChem Trading GmbH (EuroChem) for up to
100% (minimum 87%) of Colluli Module I SOP production.
Development Finance Institutions, Africa Finance Corporation
(AFC) and African Export Import Bank (Afreximbank), have obtained
formal credit approval to provide CMSC with US$200M in senior debt
finance. The credit documentation was executed in December 2019,
allowing drawdown of CMSC senior debt on satisfaction of customary
conditions precedent. This represents the majority of funding
required for the development and construction of the Colluli.
The Company's vision is to bring Colluli into production using
the principles of risk management, resource utilisation and
modularity, using the starting module (Module I) as a growth
platform to develop the resource to its full potential.
Disclaimer
The information in this document is published to inform you
about Danakali and its activities. Danakali has endeavoured to
ensure that the information enclosed is accurate at the time of
release, and that it accurately reflects the Company ' s
intentions. To the extent permitted by law, the Company accepts no
responsibility or liability for any losses or damages of any kind
arising out of the use of any information contained in this
document. Recipients should make their own enquiries in relation to
any investment decisions.
No representation or warranty, express or implied, is or will be
made by or on behalf of the Company, and no responsibility or
liability is or will be accepted by the Company or its affiliates,
as to the accuracy, completeness or verification of the information
set out in this announcement, and nothing contained in this
announcement is, or shall be relied upon as, a promise or
representation in this respect, whether as to the past or the
future. The Company and each of its affiliates accordingly
disclaims, to the fullest extent permitted by law, all and any
liability whether arising in tort, contract or otherwise which it
might otherwise have in respect of this announcement or any such
statement.
The distribution of this announcement outside the United Kingdom
may be restricted by law and therefore any persons outside the
United Kingdom into whose possession this announcement comes should
inform themselves about and observe any such restrictions in
connection with the distribution of this announcement. Any failure
to comply with such restrictions may constitute a violation of the
securities laws of any jurisdiction outside the United Kingdom.
IMPORTANT NOTICES
THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND DOES NOT
CONSTITUTE OR FORM ANY PART OF AN OFFER TO SELL OR ISSUE, OR A
SOLICITATION OF AN OFFER TO BUY, SUBSCRIBE FOR OR OTHERWISE ACQUIRE
ANY SECURITIES IN THE UNITED STATES (INCLUDING ITS TERRITORIES AND
POSSESSIONS, ANY STATE OF THE UNITED STATES AND THE DISTRICT OF
COLUMBIA (COLLECTIVELY, THE "UNITED STATES")), JAPAN, THE REPUBLIC
OF SOUTH AFRICA, OR ANY OTHER JURISDICTION IN WHICH SUCH OFFER OR
SOLICITATION WOULD BE UNLAWFUL OR TO ANY PERSON TO WHOM IT IS
UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION. NO PUBLIC OFFERING OF
THE PLACEMENT SHARES IS BEING MADE IN ANY SUCH JURISDICTION. ANY
FAILURE TO COMPLY WITH THESE RESTRICTIONS MAY CONSTITUTE A
VIOLATION OF THE SECURITIES LAWS OF SUCH JURISDICTIONS.
This Announcement is not for public release, publication or
distribution, in whole or in part, directly or indirectly, in or
into the United States, Japan, the Republic of South Africa, or any
other jurisdiction in which such release, publication or
distribution would be unlawful.
The securities referred to herein have not been and will not be
registered under the U.S. Securities Act of 1933, as amended (the
"Securities Act"), and may not be offered or sold in the United
States, except pursuant to an applicable exemption from 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. No public offering of the
Placement Shares is being made in the United States.
No action has been taken by the Company, the Sole Bookrunner or
any of its affiliates, or any of its or their respective directors,
officers, partners, employees, advisers and/or agents
(collectively, "Representatives") that would permit an offer of the
Placement Shares or possession or distribution of this Announcement
or any other publicity material relating to such Placement Shares
in any jurisdiction where action for that purpose is required.
Persons receiving this Announcement are required to inform
themselves about and to observe any restrictions contained in this
Announcement. Persons (including, without limitation, nominees and
trustees) who have a contractual or other legal obligation to
forward a copy of this Announcement should seek appropriate advice
before taking any action. Persons distributing any part of this
Announcement must satisfy themselves that it is lawful to do
so.
This Announcement is directed at and is only being distributed
to: (a) persons in member states of the European Economic Area who
are "qualified investors", as defined in Article 2(e) of the
Prospectus Regulation (Regulation (EU) 2017/1129) (the "Prospectus
Regulation") ("Qualified Investors"), (b) persons in the United
Kingdom, who are qualified investors, being persons falling within
the meaning of Article 2(e) of Prospectus Regulation (EU) 2017/1129
as it forms part of domestic law by virtue of the European Union
(Withdrawal) Act 2018 (the " UK Prospectus Regulation"), and who
(i) have professional experience in matters relating to investments
who fall within the definition of "investment professionals" in
Article 19(5) of the Financial Services and Markets Act 2000
(Financial Promotion) Order 2005, as amended (the "Order") or are
high net worth companies, unincorporated associations or
partnerships or trustees of high value trusts as described in
Article 49(2)(a) to (d) of the Order and (ii) are Qualified
Investors, or (c) otherwise, persons to whom it may otherwise
lawfully be communicated (each such person in (a), (b) and (c), a
"Relevant Person"). No other person should act on or rely on this
Announcement and persons distributing this Announcement must
satisfy themselves that it is lawful to do so. By accepting the
terms of this Announcement, you represent and agree that you are a
Relevant Person. This Announcement must not be acted on or relied
on by persons who are not Relevant Persons. Any investment or
investment activity to which this Announcement or the Placement
relates is available only to Relevant Persons and will be engaged
in only with Relevant Persons.
No offering document or prospectus will be made available in any
jurisdiction in connection with the matters contained or referred
to in this Announcement or the Placement and no such prospectus is
required (in accordance with either the Prospectus Regulation or
the UK Prospectus Regulation) to be published.
Certain statements in this Announcement are forward-looking
statements with respect to the Company's expectations, intentions
and projections regarding its future performance, strategic
initiatives, anticipated events or trends and other matters that
are not historical facts and which are, by their nature, inherently
predictive, speculative and involve risks and uncertainty because
they relate to events and depend on circumstances that may or may
not occur in the future. All statements that address expectations
or projections about the future, including statements about
operating performance, strategic initiatives, objectives, market
position, industry trends, general economic conditions, expected
expenditures, expected cost savings and financial results, are
forward -- looking statements. Any statements contained in this
Announcement that are not statements of historical fact are, or may
be deemed to be, forward -- looking statements. These
forward-looking statements, which may use words such as "aim",
"anticipate", "believe", "could", "intend", "estimate", "expect",
"may", "plan", "project" or words or terms of similar meaning or
the negative thereof, are not guarantees of future performance and
are subject to known and unknown risks and uncertainties. There are
a number of factors including, but not limited to, commercial,
operational, economic and financial factors, that could cause
actual results, financial condition, performance or achievements to
differ materially from those expressed or implied by these forward
-- looking statements. Many of these risks and uncertainties relate
to factors that are beyond the Company's ability to control or
estimate precisely, such as changes in taxation or fiscal policy,
future market conditions, currency fluctuations, the behaviour of
other market participants, the actions of governments or
governmental regulators, or other risk factors, such as changes in
the political, social and regulatory framework in which the Company
operates or in economic or technological trends or conditions,
including inflation, recession and consumer confidence, on a
global, regional or national basis. Given those risks and
uncertainties, readers are cautioned not to place undue reliance on
forward-looking statements. Forward-looking statements speak only
as of the date of this Announcement. Each of the Company and the
Sole Bookrunner expressly disclaims any obligation or undertaking
to update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise unless
required to do so by applicable law or regulation
Shore Capital Stockbrokers Limited is regulated by the FCA in
the United Kingdom and is acting exclusively for the Company and no
one else in connection with the UK Placement, and Shore Capital
Stockbrokers Limited will not be responsible to anyone (including
any Placees) other than the Company for providing the protections
afforded to its clients or for providing advice in relation to the
UK Placement or any other matters referred to in this
Announcement.
This Announcement is being issued by and is the sole
responsibility of the Company. No representation or warranty,
express or implied, is or will be made as to, or in relation to,
and no responsibility or liability is or will be accepted by or on
behalf of the Sole Bookrunner (apart from the responsibilities or
liabilities that may be imposed by the Financial Services and
Markets Act 2000, as amended ("FSMA") or the regulatory regime
established thereunder) and/or by any of its affiliates and/or any
of its Representatives as to, or in relation to, the accuracy,
adequacy, fairness or completeness of this Announcement or any
other written or oral information made available to or publicly
available to any interested party or their respective advisers or
any other statement made or purported to be made by or on behalf of
the Sole Bookrunner and/or any of its affiliates and/or by any of
their respective Representatives in connection with the Company,
the Placement Shares or the UK Placement and any responsibility and
liability whether arising in tort, contract or otherwise therefor
is expressly disclaimed. No representation or warranty, express or
implied, is made by the Sole Bookrunner and/or any of its
affiliates and/or any of their respective Representatives as to the
accuracy, fairness, verification, completeness or sufficiency of
the information or opinions contained in this Announcement or any
other written or oral information made available to or publicly
available to any interested party or their respective advisers, and
any liability therefor is expressly disclaimed.
The information in this Announcement may not be forwarded or
distributed to any other person and may not be reproduced in any
manner whatsoever. Any forwarding, distribution, reproduction or
disclosure of this Announcement, in whole or in part, is
unauthorised. Failure to comply with this directive may result in a
violation of the Securities Act or the applicable laws of other
jurisdictions.
This Announcement does not constitute a recommendation
concerning any investor's options with respect to the UK Placement.
Recipients of this Announcement should conduct their own
investigation, evaluation and analysis of the business, data and
other information described in this Announcement. This Announcement
does not identify or suggest, or purport to identify or suggest,
the risks (direct or indirect) that may be associated with an
investment in the Placement Shares. The price and value of
securities can go down as well as up and investors may not get back
the full amount invested upon the disposal of the shares. Past
performance is not a guide to future performance. The contents of
this Announcement are not to be construed as legal, business,
financial or tax advice. Each investor or prospective investor
should consult his or her or its own legal adviser, business
adviser, financial adviser or tax adviser for legal, business,
financial or tax advice.
Any indication in this Announcement of the price at which the
Company's shares have been bought or sold in the past cannot be
relied upon as a guide to future performance. Persons needing
advice should consult an independent financial adviser. No
statement in this Announcement is intended to be a profit forecast
or profit estimate for any period and no statement in this
Announcement should be interpreted to mean that earnings, earnings
per share or income, cash flow from operations or free cash flow
for the Company for the current or future financial periods would
necessarily match or exceed the historical published earnings,
earnings per share or income, cash flow from operations or free
cash flow for the Company.
All offers of the Placement Shares will be made pursuant to an
exemption under the Prospectus Regulation and the UK Prospectus
Regulation from the requirement to produce a prospectus. This
Announcement is being distributed and communicated to persons in
the United Kingdom only in circumstances in which section 21(1) of
FSMA does not apply.
The Placement Shares to be issued pursuant to the Placement will
not be admitted to trading on any stock exchange other than the
main market for listed securities of the London Stock Exchange and
the Australian Stock Exchange.
Neither the content of the Company's website (or any other
website) nor the content of any website accessible from hyperlinks
on the Company's website (or any other website) is incorporated
into, or forms part of, this Announcement.
This Announcement has been prepared for the purposes of
complying with applicable law and regulation in the United Kingdom
and the information disclosed may not be the same as that which
would have been disclosed if this Announcement had been prepared in
accordance with the laws and regulations of any jurisdiction
outside the United Kingdom.
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END
MSCDKCBPPBKKKQB
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April 29, 2021 02:00 ET (06:00 GMT)
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