TIDMSTHP
RNS Number : 2602O
Stranger Holdings PLC
02 October 2023
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR PART,
DIRECTLY OR INDIRECTLY, IN OR INTO OR FROM THE UNITED STATES,
CANADA, JAPAN, SOUTH AFRICA OR AUSTRALIA OR ANY OTHER JURISDICTION
WHERE SUCH DISTRIBUTION WOULD BE UNLAWFUL.
This announcement is an advertisement for the purposes of the
Prospectus Rules of the Financial Conduct Authority ('FCA') and not
a prospectus (or prospectus equivalent) and not an offer of
securities for sale nor a solicitation of an offer to acquire or a
recommendation to sell or buy securities in any jurisdiction,
including in or into the United States, Canada, Japan, South Africa
or Australia. Neither this announcement, nor anything contained
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 ordinary shares
(the 'Shares') referred to in this announcement except on the basis
of information contained in the prospectus (together with any
supplementary prospectus, if relevant, the 'Prospectus'), including
any risk factors set out therein, published by Stranger Holding plc
(the 'Company') in connection the proposed re-admission of such
Shares to the Official List of the Financial Conduct Authority (the
'FCA') by way of a Standard Listing and to trading on the main
market for listed securities of the London Stock Exchange plc (the
'LSE'). Copies of the Prospectus will shortly be available from the
Company's registered office at 27-28 Eastcastle Street, London W1W
8DH and on the Company's website at www.strangerholdingsplc.co.uk.
The information contained within this announcement is deemed by the
Company to constitute inside information as stipulated under the
Market Abuse Regulations (EU) No. 596/2014.
Stranger Holding plc / EPIC: STHP / Market: Main Market
2 October 2023
Stranger Holdings plc
("Stranger" or the "Company")
Approval & Publication of Prospectus
Stranger Holdings plc, a company formed for the purpose of
acquiring a business, project or assets in order to potentially
generate significant shareholder returns, is pleased to confirm
that its Prospectus (the "Prospectus") in respect of the:
-- Proposed Acquisition of up to a 70% interest in the Henkries
Uranium Deposit and Prospecting Right in the Republic of South
Africa;
-- Issue of 1,070,601,468 Ordinary Shares in connection with a
placing and conversion of debt into equity;
-- Admission of 1,216,371,468 Ordinary Shares of GBP0.0001 par
each to the Official List (by way of Standard Listing under Chapter
14 of the Listing Rules) and to trading on the London Stock
Exchange's Main Market for listed securities; and
-- Notice of General Meeting including a resolution to change
the name of the Company to Neo Energy Metals plc
has been approved by the FCA and published by the Company.
The Prospectus contains, inter alia, details of the proposed
acquisition whereby Stranger will become the indirect owner of
50.1% of Desert Star Trading 130 Proprietary Limited ("Desert
Star"), a company registered in the Republic of South Africa with
Registration Number 200501474307.
Desert Star is the legal and beneficial owner of a uranium
prospecting right NC30/5/1/1/2/11918 in the Northern Cape of the
Republic of South Africa commonly known as the Henkries Uranium
Project ("Henkries Project").
The Company will acquire this indirect ownership via the
acquisition of two intermediary holding companies, namely Mayflower
Energy Metals Limited ("MEML") and Neo Uranium Africa Proprietary
Limited ("NURSA"). MEML owns 100% of the share capital of NURSA,
and NURSA owns 50.1% of the share capital of Desert Star, and an
earn in option to increase ownership to 70%.
Should the acquisition of MEML complete, the Company would
therefore become the controlling holding company of a uranium
exploration company with operations in South Africa.
The Acquisition constitutes a Reverse Takeover under the Listing
Rules since, in substance it results in a fundamental change in the
business of the issuer. Therefore, trading in the Existing Ordinary
Shares continues to be suspended. It is anticipated that
Re-Admission and trading in the Company's Enlarged Share Capital
will occur on or around 7 November 2023.
The Prospectus is available on the Company's website
www.strangerholdingsplc.co.uk and has been submitted to the
National Storage Mechanism and will shortly be available for
inspection at
https://data.fca.org.uk/#/nsm/nationalstoragemechanism .
Overview
-- Agreed to acquire MEML and NURSA resulting in the Company
owning 50.1% per cent. in Desert Star (with an option to increase
such interest to 70%), through the issue of ordinary shares as
follows:
o Stranger will satisfy NURSA's remaining obligations to Desert
Star with cash or the issue of consideration shares in
Stranger;
o Stranger will pay GBP1,750,000 through the issue of
Consideration Shares to MEML and/or MEML's designees on completion
of the Acquisition;
o Upon completion of an updated JORC Compliant Resource in
excess of 4.5 million tonnes of U3O8 at an average grade of 400 ppm
U3O8, Stranger will pay GBP500,000 through the issue of
Consideration Shares to MEML and/or its designees;
o Upon completion of an updated JORC Compliant Resource in
excess of 10 million tonnes of U3O8 at an average grade of 400 ppm
U3O8, Stranger will issue a further GBP500,000 of Deferred
Consideration shares to MEML and/or its designees.
-- The Henkries Project is a 742km2 prospecting right under
exploration that uses both the Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves (JORC), and
the Canadian Institute of Mining Metallurgy and Petroleum National
Instrument 43-101 (43-101). Its assets include, inter alia, a
uranium deposit originally explored by the Anglo American
Corporation (AAC) in 1979, later developed by subsequent right
holders, with an estimated mineral resource of 4.7 million pounds
of uranium.
-- Stranger's strategy is layered on a short-term (2-year)
development approach to generate cashflow from the Henkries Project
with a view towards building a longer term (8-year) exploration and
portfolio growth strategy to develop the highly prospective
Northern Cape Region of South Africa and, potentially, broader
regional expansion into energy metals property holdings
globally.
-- Stranger has conditionally raised gross proceeds of
GBP4,900,000 through the issue of Placing and Subscription Shares
(the "Fund Raising"). The Fund Raising will be completed in several
rounds: at an effective price of 0.2267p per share for the first
round of subscriptions, at 0.75p per share for the second round of
subscriptions and at 1.25p for the Placing (the "Placing
Proceeds").
-- The net Placing Proceeds will be used to satisfy MEML's
Acquisition-related liabilities, MEML's fees and costs, satisfy in
full trade creditors of Stranger, and for ongoing working capital
to advance the Henkries Project to a production decision.
-- Notice of General Meeting is included in the Prospectus which
includes a resolution to change the name of the Company from
Stranger Holdings plc to Neo Energy Metals plc
Uranium Market
Present demand & outlook
Nuclear power is seen by the global energy markets as a key
component in the overall transition towards a low or net-zero
carbon, lower cost, sustainable energy economy. Furthermore, during
the transitional phase, governments around the globe are
increasingly keen to promote investment into new technologies to
facilitate more prevalent and flexible deployment of nuclear power,
such as smaller, modular reactors. In the Directors' view, these
concerns will encourage a greater demand for enriched uranium and,
as a result, U3O8.
This demand will likely be further propelled by increased
electricity needs. The decarbonization of the world's energy
ecosystem will go hand-in-hand with the anticipated electrification
of heating and transport. The Directors expect that electric-based
heating solutions (like heat pumps and infrared) will increase,
whilst gas-based central heating will decline and there will be a
projected 1.6bn electric cars in use by 2050, as governments
regulate production of petrol-powered vehicles. As the world seeks
to shift to the net-zero economy (NZE), the Directors anticipate
that nuclear energy will play a key role, alongside renewables, in
ensuring adequate supply is sustained.
The markets for uranium are therefore global, and production is
projected to ramp at a compound annual growth rate (CAGR) of 5% in
the mid-term, reaching 65 thousand tonnes by 2025.
Pricing
Uranium pricing is governed by two broad processes. Firstly,
spot prices on the open market are moved by short-term trading
sentiment and supply and demand at any one moment. Events like the
closure of major mines or changes in regulatory positions can also
have an effect. Uranium trading businesses (e.g. Sprott Physical
Uranium Trust (TSE:U.UN) and Yellowcake (LON: YCA)) most often use
this spot price to rate the value of the stock they hold or are
committed to purchase.
However, in some respects the spot price can be a purely
nominal, indicative measure, as much of the uranium trading that
continues around the world is conducted privately and on the basis
of long-term fixed contracts between buyers (nuclear power
producers) and sellers (yellowcake miners), and more often than not
these prices are not directly disclosed. In some cases, a producer
may want to lock in procurement prices 5 or 10 years in advance, to
de-risk and enable it to sell customer contracts over the longer
term.
Competitive Landscape
The uranium mining sector is dominated by multinationals and
state-backed entities, making for a small number of producers that
control most of the supply. Table 3, below, summarizes the major
market shares of worldwide uranium production. This picture
predominantly reflects the post-Fukushima, Covid-reduced economic
activity scenario, where many Western mines (including the world's
largest mine at McArthur River in Canada) were put on care and
maintenance due to a low uranium price and an oversupply of
yellowcake. The Directors anticipate that a global drive to
de-carbonise economies will change this picture significantly.
By far, the largest operator is KazAtomProm, the state-led
Kazakhstani minerals company that mines over 20% of the world's
supply of uranium. Canadian firm Uranium One and the French group
Orano are presently the joint second largest. Other notable
companies involved in uranium mining include Rio Tinto, which
currently has a market share of 2%, and BHP, currently at 6%.
Cameco, which holds controlling stakes the largest uranium mines in
the world (McArthur River and Cigar Lake, which are both in Canada)
currently is estimated at 6% market share.
Despite KazAtomProm being the largest producer in the world,
Kazakhstan itself holds an estimated 15% of the Earth's uranium
resources. Australia holds the largest caches of uranium on the
globe, at an estimated 28%. Much of this remains untapped. The
United States, whilst being abundant in other energy-related
resources like shale oil and gas, is only estimated as having 1% of
global uranium reserves. Uranium imports, therefore, are
significant to the United States as it requires uranium for
maintaining its large nuclear arsenal and submarine fleet.
Strategy & Objectives
The strategy of the Company is layered on a short-term (2-year)
development approach to generate cashflow from the Henkries Uranium
Project with a view towards building a longer term (8-year)
exploration and portfolio growth strategy to develop the highly
prospective Northern Cape Region of South Africa and, potentially,
broader regional expansion into energy metals property holdings
globally. The Company's strategy can be summarised as follows:
1. Develop the Henkries Uranium Project as fast as possible (2
years) into a small-scale production facility. The Directors aim to
make a mine investment decision within 2 years, and then spend the
following 9 to 18 months developing a small-scale uranium mine to
generate cash-flow.
2. NURSA possesses an extensive database of the energy metal
potential of Africa and has spent months developing a targeted
approach to potential future acquisitions. The Directors' aim is to
procure assets of a suitable potential that can be explored and
developed or sold to increase shareholder value. This acquisition
strategy has already begun with an agreement in principle with
Eagle Uranium SA which includes a property in the Northern Cape
Region of South Africa close to Henkries. The Directors aim to
explore the balance of the region to increase the life of the
operations at Henkries during years 2-4. The Directors' latest data
indicates that there are several high-potential uranium targets
that could be developed in the Northern Cape Region, either to
extend the life of the Henkries mine or to increase the modular
production capacity of any future plant at Henkries.
3. The final leg of the strategy is to explore additional
minerals of significant intrinsic value to the global
de-carbonisation drive such as lithium, graphite copper, lead and
zinc, should they occur on properties under investigation. The
Competent Persons Report (CPR) annexed to this Prospectus
highlights the fact that the Henkries Uranium Project's basement
gneisses are mostly of the Aggeneys Subgroup and the Marula Mining
Blesberg Spodumene (lithium) deposit and are less than 30km from
Henkries, with the potential for further discoveries of this nature
in the region. In addition, data obtained in May 2022 from detailed
historical airborne surveys identified what could be a significant
base metal anomaly within the Henkries property. Any discoveries
worthy of investigation have the potential to be spun out with the
proceeds being used to fund further the Company's uranium growth
strategy.
Re-Admission
As the Acquisition constitutes a Reverse Takeover under the
Listing Rules, the London Stock Exchange will cancel trading in the
Existing Ordinary Shares on the Main Market for listed securities,
and the FCA is expected to cancel the listing of the Existing
Ordinary Shares on the standard segment of the Official List by
07.30 a.m. on 7 November 2023.
Applications will be made for the Existing Ordinary Shares to be
readmitted and the New Ordinary Shares to be admitted to the
Official List of the London Stock Exchange by way of a Standard
Listing and to trading on the Main Market. Re-Admission is expected
to occur at 8.00 a.m. on 7 November 2023 and copies of this
Document will be available to the public, free of charge, until the
expiry of one month from the date of Re-Admission.
If the Acquisition does not complete, the suspension on the
Existing Ordinary Shares is expected to be lifted and trading in
the Existing Ordinary Shares is expected to recommence.
Expected Timetable of Principal Events
29 September 2023
* Published Prospectus
1.00 p.m. on 1 November
* General Meeting 2023
7 November 2023
* Completion of Acquisition
* Issue of Consideration Shares, Equity-for-Debt Shares, 7 November 2023
Placing Shares, Introducer and Advisor Shares and
Performance Shares
7.30 a.m. on 7 November
* Cancellation of trading of Existing Ordinary Shares 2023
* Admission of the Enlarged Share Capital effective / 8.00 a.m. on 7 November
commencement of dealings in Ordinary Shares 2023
* Dispatch of definitive share certificates for
Consideration Shares, Equity-for-Debt Shares,
Convertible Loan Note Shares, Placing Shares, w/c 13 November 2023
Introducer and Advisor Shares Performance Shares and
Deferred Shares
All times shown are London GMT times unless otherwise stated.
The dates and times given are indicative only and are based on the
Company's current expectations and may be subject to change. If any
of the times and/or dates above change, the revised times and/or
dates will be notified to Shareholders by announcement through the
Regulatory News Service of the London Stock Exchange.
Following admission, and the admission of all subscription
shares, the Company's enlarged share capital will be 1,623038,134
ordinary shares and 2,258,388,589 on a fully diluted basis. The
Company's shares will trade under the following Dealing Codes:
-- ISIN GB00BYWLRL80
-- SEDOL BYWLRL8
-- EPIC/TIDM: STHP
Stranger Chairman and CFO, James Longley, said: " We are
delighted to announce the publication of our prospectus ahead of
relisting our shares on the London Stock Exchange targeted for 7
November 2023. We have worked hard to establish a strong foundation
for future growth with the acquisition of the Henkries Uranium
Project. With a clear pathway to production of uranium and sales
into the international uranium market, this exciting project
provides immediate exposure to the uranium sector and a near-term
uranium producer.
"Given less than 10% of its prospective ground is fully tested,
Henkries is wide open for potential new uranium discoveries.
Notably, +US$30m of historical work including exploration,
drilling, test-pitting and mining, metallurgical testwork, pilot
plant work, and a Feasibility Study, has been completed previously.
Our focus is now on updating the Feasibility Study and increasing
the project's Mineral Resources ahead of fast-tracking to
production.
"In light of the dual challenges of improving energy security
and reducing emissions, which have reinforced the case for nuclear,
this is an opportune time to be welcoming new investors to our
company and broadening our market reach. We are delighted with the
support received so far, having secured c.GBP4.9 million through a
placing and subscriptions, which is testament to the strength of
our business, and we look forward to realising the opportunities
ahead."
**ENDS**
For further information on the Company please contact :
James Longley Stranger Holdings plc jamestclongley@aol.com
Isabel de Salis/Paul Dulieu St Brides Partners neo@stbridespartners.co.uk
Ltd,
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