LONDON: Chaarat Gold Holdings, the gold mining company with assets in the Kyrgyz Republic and Armenia, announced that following discussions related to the acquisition of the Kapan mine acquired in January 2019 from Polymetal International Plc, Polymetal has agreed to exchange its US$10 million of Convertible Notes received as part of original consideration, and a working capital settlement under the SPA for 14,638,020 newly issued ordinary shares of USD 0.01 each.
This shall represent 3.5% of the enlarged fully diluted share capital of Chaarat post allotment. The new shares shall be subject to a twelve month lock-up arrangement and Polymetal shall grant a right of first refusal effective from the end of the lock-up arrangement for six months in the event of the sale of those New Shares to Chaarat.
As a part of this arrangement Chaarat Gold International Limited, a wholly owned subsidiary of Chaarat, has also agreed to release Polymetal from warranties and indemnities under the sale and purchase agreement on acquisition of Kapan except for a limited number of reserved matters.
Chaarat is grateful to Polymetal for its continued support, which has been reaffirmed in the current agreement, and looks forward to continuing its mutually beneficial commercial partnership with the company.
Artem Volynets, Chief Executive Officer of Chaarat, said: “We are delighted to welcome this experienced operator on to our shareholder register. Polymetal’s decision to exchange its debt for shares in Chaarat is an endorsement of our strategy and prospects, implies a premium to our current market value, and reduces our debt levels.”
Edited by Nayyar Iqbal