Arcadia Minerals Limited

Acquisition Agreement with ORP, Karibib and BME: Arcadia Minerals Limited (Proposed ASX Code: AM7) is a speculative exploration firm, incorporated on 7 October 2020 in Guernsey to acquire portfolio rights of resource projects in the Republic of Namibia. AM7 has inked a conditional agreement to purchase an interest in the Swanson Project (80%), Kum-Kum Nickel-Cu-PGE Project, presently owned by Orange River Pegmatite (Proprietary) Limited (ORP). It will invest in 80% of the issued share capital of Karibib Pegmatite Exploration (Proprietary) Limited for its Karibib Project (68%). It will acquire 50% of the issued share capital of Brines Mining Exploration Namibia (Proprietary) Limited (BME) for the Bitterwasser Lithium Project (50%).

IPO Details: AM7 has announced a Public Offer to raise $5.9-$6.4 million via the issue of a minimum of 29.50 million and a maximum of 32 million CDIs at $0.20 per CDI. It has also proposed secondary offers such as – Consideration Offer (for the acquisition of projects), the Lender Offer (to the project lenders for loan extinguishment), and two more offers. The company lodged the Original Prospectus with ASIC on 31 March 2021 and a Replacement Prospectus on 15 April 2021. The Retail Offer opens on 16 May 2021 and closes on 19 May 2021. The company will issue shares under the Offers on 26 May 2021 and expects to start trading on ASX on 4 May 2021.

Offer Highlights (Source: Company Reports)

Funds Utilisation: As per the Prospectus, the company will utilise an available cash balance of $0.35 million and ~5.90 million funds raised via minimum subscription towards the four projects for the next two years. ~$0.68 million of the total funds will be applied towards the working capital needs, and $0.663 million will be used to meet the expenses of the various secondary offers.

Use of Funds Summary (Source: Company Reports)

Key Shareholders: Based on the known information contained in the Prospectus, and on the completion of the issue of CDIs under the Offers, the following entities are expected to hold a relevant interest in 5% or more of the CDIs on the issue:

Substantial Shareholders, Post-Completion of the Offers (Source: Company Reports)

Key Risks: The company faces the risk of limited operating history and financial performance, risk of completion of conditions to be met under the acquisition agreement to acquire an interest in ORP, BME and Karibib. It is dependent on outsourcing exploration work and the performance of agents and contractors. 

Summary: Post the completion of the Offers, AM7 intends to prioritise the exploration work and definition of a JORC compliant resource at the Swanson Project. Based on the outcomes, it will complete a project feasibility study. The company remains on track to plan and evaluate the exploration avenues on the other three projects acquired, namely Kum-Kum, Karibib and Bitterwasser projects. Further, it also seeks to investigate exploration prospects within Namibia, which may present growth opportunity, going forward.

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