Despite raising just $83,000 in seven months, the backers of the deal to spin off Conquest Mining's diamond assets remained confident of raising the necessary $5 million, claiming Malaysian interests intended to take a $2.2 million stake.
The sale of Conquest Mining Ltd's East Kimberley diamond tenements to Lake Argyle-Bow River Diamonds Ltd has been delayed again, with Lake Argyle-Bow extending the closing date on its prospectus a third time. However, those behind the deal remained confident of raising the necessary $5 million, claiming Malaysian interests intended to take a $2.2 million stake.
The sale agreement is conditional upon Lake Argyle completing a capital raising program of up to $7,250,000 through the offer of 25,000,000 ordinary shares at 25c each and 20,000,000 options at 5c each.
The prospectus was originally set to close on July 1.
Lake Argyle-Bow River Diamonds has, as at the date of yesterday's prospectus, had received thesubscriptions for 281,000 shares worth $70,250 and 270,000 options worth $13,500 for a total of $83,750.
The announcement said Lake Argyle has been involved in discussions with a number of investors who are
interested in taking substantial positions in the project. It said a Malaysian-based investment house has already given notice of its intention to apply for securities to a value of $2,200,000. Other investors are still concluding their due diligence processes
and the Lake Argyle was confident that a further extension of the closing date will allow it to raise the minimum subscription of $5,000,000.
The original announcement in in April
The board of directors of Conquest Mining Limited (Conquest) is pleased to announce
that it has entered into an agreement to sell its East Kimberley Diamond Tenements to
Argyle Bow River Diamonds Limited (Argyle) in consideration for a cash payment to
Conquest of $2,000,000 (for re-imbursement of past expenditure on the tenements) and
the issue of 5,000,000 fully paid ordinary shares in the capital of Argyle (Argyle Shares)
to Conquest at a deemed issue price of $0.25 each, for a total consideration of
$3,250,000.
The divestment of the East Kimberley tenements which are still in the exploration stage
and the $2,000,000 cash injection will enable Conquest to focus on developing its more
advanced West Kimberley/Ellendale 17 Diamond assets. The directors believe that
Conquest shareholders will benefit through the Company's ability to bring forward the
timetable for the further development of the Ellendale 17 project, whilst still maintaining a
significant interest in a highly prospective project through its Argyle Bow River Diamonds
Limited share holding.
The sale agreement is conditional upon:
a) Argyle completing a capital raising of up to $7,250,000 through the issue of
25,000,000 Argyle Shares at an issue price of $0.25 each and 20,000,000
options at an issue price of $0.05 each (with a minimum subscription of
$5,000,000)(Capital Raising); and
b) Conquest and Argyle obtaining all necessary consents and approvals for the
transfer of the tenements to Argyle.
The Capital Raising will be made pursuant to a prospectus to be lodged with the ASIC on
or about 22 April 2005 (Prospectus).
In accordance with a waiver obtained from ASX, 5,000,000 Argyle Shares offered under
the Prospectus will be offered in priority to shareholders of Conquest registered as at
5.00pm (WST) on 2 May 2005 on a first come first served basis. However, all Conquest
shareholders will be guaranteed at least $2,000 worth of Argyle Shares if they submit an
application.
If subscriptions from existing Conquest shareholders exceed 5,000,000 Argyle Shares,
Argyle will accept oversubscriptions of up to a further 5,000,000 Argyle Shares under the
priority offer.
The offer by Argyle is due to open on 2 May 2005 and close on 1 July 2005.
In the event Argyle successfully completes the Capital Raising, the end result will be that
the East Kimberley Diamond Tenements will be spun-off into a new listed vehicle
(Argyle), Conquest will receive a cash payment of $2,000,000 and Conquest will hold an
approximate 16% interest in the newly listed Argyle. It is not currently proposed that any
of the shares held by Conquest in Argyle will be distributed in specie to Conquest
shareholders.
Details of the East Kimberley Diamond tenements are set out in Argyle's Prospectus
which can be downloaded from the following website
