Power Metal Resources announces partial sale of GMET stake for £9.2 million

LONDON: Power Metal Resources PLC (AIM:POW, OTCQB:POWMF) has announced its intent to partially divest its stake in Guardian Metal Resources PLC (GMET).

The exploration company has reached an agreement with UCAM Ltd for the proposed transaction. UCAM Ltd is set to purchase 29,758,334 shares in GMET and warrants over 986,352 ordinary shares in GMET, valued at £9.2 million before costs.

The deal’s completion hinges on UCAM’s successful fundraising efforts, administrative processes, and the finalization of a Sale and Purchase Agreement (SPA) within 10 business days. There is no certainty regarding the timeline or finalization of the agreement.

If concluded as planned, Power Metal’s holding in GMET will be reduced to 25,169,772 shares, representing approximately 19.2% of GMET’s issued share capital.

Proceeds from the transaction will be used to redeem a £2 million loan note issued to ACAM LP and for general corporate purposes. Tamesis Partners LLP is advising Power Metal on the transaction.

“I am very pleased to announce the intended monetization of a portion of our holding in GMET, introducing a significant strategic investor,” said Sean Wade, CEO of Power Metal Resources. “GMET has been a very successful investment for us, yielding a return of 966% on this part of our investment.”

He added that the transaction would validate Power Metal’s incubator model and instill confidence in its ability to generate substantial shareholder returns, while maintaining a commitment to their remaining stake in GMET.