TIDMVGM

RNS Number : 5433H

Vatukoula Gold Mines PLC

21 June 2013

21th June 2013

Vatukoula Gold Mines plc.

("Vatukoula" or "the Company")

Update on Second Tranche of Placing & Directorate Changes

Vatukoula Gold Mines Plc, is pleased to announce that the Company expects the second tranche of the placing announced on 20 May 2013 to be completed within the next seven working days.

On 20 May 2013 Vatukoula announced that it had entered into a subscription agreement with SCD Energy Inc. ("the Subscriber"), which is an indirect wholly owned subsidiary of DRK Energy Co. Limited ("DRK"). Under this agreement the Subscriber subscribed for 30,000,000 new ordinary shares in the Company at a price of GBP0.15 per share (the "Subscription Shares") to raise GBP4.5 million (the "Subscription Agreement"). The Subscription Shares will represent approximately 19.2% of the enlarged issued share capital of the Company.

The Subscription Agreement was to be completed via the issue of two equal tranches of 15,000,000 (GBP2.25 million). The first tranche was completed on the 23(rd) of May 2013, the second tranche is now expected to be completed by the 28(th) June 2013.

In addition, under the Subscription Agreement, the Company and DRK have agreed to work in conjunction to source the required debt financing to fund the Company's planned expansion programme.

Should VGM enter into a debt financing package facilitated or introduced by DRK of no less than US$40 million within 120 days (September 17, 2013) of the Subscription Agreement ("Debt Financing"), DRK will have the option to acquire an additional 24,000,000 new ordinary shares in the Company (the "Option") at an exercise price of GBP0.15 per share.

As disclosed on the 20th May 2013 in conjunction with the Subscription Agreement, the Company has agreed that the Subscriber will be entitled to nominate two directors for appointment to the Board of seven directors. The two directors appointed by the Board of the Company are Mr Wei Li and Mr Yongan Lu.

Mr Wei Li (aged 44) joined China National Oil and Gas Exploration and Development Corporation in 1998 as a Senior Engineer in the Project Administration Department and was responsible for management and control of two projects in Kazakhstan. In 2000 he joined Greater Nile Petroleum Operating Company ("GNPOC") as Deputy Manager in the Planning Department where he advised management on policies, plans and decisions pertaining to GNPOC's operations. In 2009 he was appointed President of DRK Energy Limited, an oilfield services provider to the global market.

Current Directorships:

DRK Energy Co., Ltd

Previous Directorships (within 5 years)

None

Mr Yongan Lu (aged 43) joined China Shandong International Economic & Technical Cooperation Corp., ("CSI") in 1991. He has served in numerous positions within the Company, including: General Manager of the Nepal Office of CSI, Deputy Manager of Economic Aid & Engineering Department of CSI, General Manager of Tanzania Branch of CSI. He is currently Manager of Mineral Resources of CSI.

Current Directorships

China Shandong International Economic & Technical Cooperation Corp.,

Previous Directorships (within 5 years)

None

There is no further information to be disclosed under Rule 17 and Schedule 2 Paragraph G of the AIM Rules.

In addition and in order to complete the Subscription agreement and comply with the shareholder agreement with Zhongrun International Mining Co. Ltd; both of which require a board of seven directors, both Kiran Caldas Morzaria and John Francis Kearney have agreed to tender their resignations as Directors of the Company with immediate effect.

Although no longer a Director, Kiran Caldas Morzaria will remain as the Chief Financial Officer of the Company and continue to play a critical role in the development of the Vatukoula Gold Mines. His roles and responsibilities will remain the same. In particular he will remain on the executive committee and participate in all board meetings.

Yingbin Ian HE, Non-Executive Chairman of Vatukoula Gold Mines, commented:

We are pleased to welcome the addition of Mr. Li and Mr. Lu to the Board. They both bring a wealth of experience and the Company will benefit from their experience in the Asian markets.

While Kiran has stepped down as a director we view him and as intergral part of the on-going development of the Company and we are pleased he has agreed to remain as Chief Financial Officer of the Company.

I would also like to thank John Kearney for his tireless efforts over the past 4 years. He contributed immensely to the development of the Board and provided the Company with valuable guidance and strategic vision.

-Ends-

 
 
  Enquiries: 
 
  Vatukoula Gold Mines plc       Pelham Bell 
                                 Pottinger 
                    + 44 (0)                     + 44 (0) 
                     20 7440                      20 7861 
David Paxton         0643      Charles Vivian     3126 
Kiran Morzaria                 Marcin Zydowicz 
 
  W.H. Ireland                   Daniel Stewart 
  Limited 
                    + 44 (0)                     + 44 (0) 
                     20 7220                      20 7776 
James Joyce          1666      Colin Rowbury      6550 
James Bavister

This information is provided by RNS

The company news service from the London Stock Exchange

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