The Board of IronRidge Resources Limited (AIM: IRR)) is seeking shareholder approval to demerge its gold projects and to change the company’s name at this year’s AGM be held on November 18, 2021.
“The last 12 months has been the strongest performing period on record in the company’s history and the upcoming AGM will set a new marker as the company proposes to reposition its assets to deliver shareholders a far more attractive investment into two newly branded companies, with a strategic focus on either gold or lithium: Ricca Resources Limited and the company (proposed to be re-named Atlantic Lithium Limited), respectively,” CEO, Vincent Mascolo, said.
“The proposed demerger of IronRidge’s gold assets follows on from IronRidge’s July statement regarding the Company’s agreement with Piedmont Lithium Inc., a Nasdaq listed lithium exploration and development company, to fully fund and fast track the Ewoyaa Lithium Project, part of the company’s Ghanaian Cape Coast Lithium Portfolio, to production.
“The company would like to thank all shareholders for their loyal support over what has been an extremely busy and rewarding period and looks forward to their support in the period ahead.”
Highlights for the Proposed Gold Demerger:
The proposed demerger comes as the company’s Directors believe that current market conditions suggest that:
o IRR is currently undervalued on its lithium portfolio only; and
o IRR is receiving little to no value for its extensive gold portfolios.
The proposed demerger is designed to unlock shareholder value across both the Company’s gold and lithium portfolios.
The proposed demerger is part of the growth strategy for IronRidge
The proposed new gold company will be called Ricca Resources Limited (“Ricca”) and will remain unlisted at this stage.
Subject to satisfaction of the demerger conditions Ricca is to receive an initial cash subscription of A$7m as part of the agreement for the transfer of the gold assets from the Company to Ricca.
- Subject to satisfaction of the demerger conditions Eligible IRR shareholders will receive an in-specie distribution of 1 Ricca Share for every 8 IRR Shares held at the In-specie Distribution Record Date (which is currently scheduled to be November 23, 2021).
- Subject to satisfaction of the demerger conditions Eligible IRR shareholders will also receive a priority offer to participate in a pro rata rights issue by Ricca to raise a further A$7.1m at A$0.10 cents per Ricca share, with entitlements being determined on the Rights Issue Record Date (currently scheduled to be 23 November 2021).
- Post the proposed demerger and assuming full subscription under the proposed Rights Issue, Ricca will have a closing cash balance of A$14.1m before costs with an issued capital of 143,436,062 Shares.
- The =company will not retain any interest in Ricca following the proposed transaction.
- Canaccord Genuity (Australia) Limited has agreed to act as Lead Manager for the Ricca Rights Issue. The Company is also seeking to secure underwriter(s) for The Rights Issue and will keep investors and shareholders up to date in this regard.
- Post the proposed demerger IronRidge will maintain a strong cash position of c.US$22m.
Proposed Name Change to Atlantic Lithium Limited:
The proposed name change of the Company to Atlantic Lithium Limited is subject to shareholder approval.
The name change is timely and in line with the Company’s core focus and strategy to fast-track development of its industry standout Ewoyaa Lithium Project in Ghana.
The name Atlantic Lithium speaks to the notion of asset location and main markets the company ultimately expects to service with high grade lithium concentrate.
The AIM trading symbol will change from “IRR” to “ALL” to reflect this name change.
For further information please visit: https://www.ironridgeresources.com.au/