TIDMLRL
RNS Number : 8170L
Leyshon Resources Limited
30 April 2015
LEYSHON RESOURCES LIMITED
30 April 2015
Quarterly Report March 2015
Leyshon Resources Limited (AIM/ASX: LRL) ("Leyshon" or the
"Company") activities during the quarter focused on identifying a
new project opportunity for the Company following the termination
of the International Tungsten Services Limited ("ITS") transaction.
The board has also determined it prudent to continue simplifying
the Company's corporate structure and reducing costs.
Termination of International Tungsten Services Transaction
On 20 November 2014, the Company signed a Heads of Agreement for
a proposed transaction to acquire a 50.1% interest in a private
Korean company, ITS. During the quarter, the Company advised that
it was no longer pursuing the transaction with ITS due to a number
of factors including declining tungsten prices since entering the
Heads of Agreement and the expanding project timetable, which had
resulted in the proposed transaction ceasing to meet the Company's
financial return objectives.
The Company provided an initial unsecured working capital
facility to ITS of US$500,000. This facility was subsequently
increased by US$120,000 and the aggregate loan of US$620,000 is due
for repayment by ITS in accordance with its terms by 26 December
2015.
New Project Opportunities
The Company continues to pursue investment opportunities in the
resources sector which are in line with the Company's stated
investing policy. The Company's strategic objective is to identify
projects that have a clear pathway to production or monetization
and can generate high returns to shareholders. This will be
achieved by leveraging the in-house expertise and track-record in
identifying, acquiring, financing, developing and operating
resource projects, and un-locking value. The Company's plan is to
identify advanced or brown-field assets which have a high
probability of being re-rated in the listed market.
Whilst the overall investment climate in the resources sector
continues to be very difficult, asset valuations are currently
substantially discounted, which we believe will provide an
attractive investing opportunity at the bottom of the investment
cycle. However structuring a transaction, at these low commodity
prices, that meets the Company's requirements for return to
shareholders has proved to be difficult. This was the case with
ITS, leading to termination of discussion. A number of
opportunities are currently being studied, although none are at an
advanced stage and management do not currently have an expectation
of completing a transaction in the next few months.
Financial
The Company retains a strong cash position with working capital
of AUD$1.3 million. Management is looking at managing the level of
corporate overheads to preserve cash during this protracted period
while the Company identifies a new opportunity, including the
proposal to cancel admission to trading on AIM which would reduce
ongoing administrative overheads as well as reducing the costs of
implementing a new transaction when one is eventually identified
and transacted upon.
Furthermore, management continue to review any strategies or
opportunities which would further reduce the Company's operating
costs and/or make the Company more attractive to potential new
projects.
ASX/AIM Suspension Update
The shares of Leyshon Resources have been suspended from trading
on the Australian Securities Exchange ("ASX") since 14 July 2014
and will remain suspended. ASX policy, in accordance with Chapter
12 of the Listing Rules, is to allow companies that have disposed
of their main undertakings a six-month period within which to
satisfy ASX that the company has a sufficient level of operations
to justify continued quotation of the Company's securities on the
ASX. The Company was not able to satisfy the ASX that it was in
compliance with Chapter 12 and was suspended from trading on 14
July 2014.
On 20 November 2014, the shares of Leyshon Resources were also
suspended from trading on the AIM Market on the announcement of the
proposed transaction with ITS (which constituted a possible reverse
takeover). Following the termination of the proposed transaction
with ITS on 23 January 2015, as the Company is an investing company
subject to AIM Rule 15 and it had not implemented its investing
policy or completed an acquisition which constitutes a reverse
takeover under the AIM Rules for Companies within 12 months of
becoming an investing company, trading of the Company's shares on
the AIM Market remained suspended. The Company has 6 months
following termination of the proposed transaction with ITS to
implement its investing policy or complete an acquisition which
constitutes a reverse takeover otherwise the AIM listing will be
cancelled. As stated above, management do not currently have an
expectation of completing a transaction and meeting the
requirements for re-compliance, including obtaining shareholder
approval, within the next few months.
In order to reduce ongoing costs to preserve cash while the
Company pursues new opportunities, the Company has announced its
intention to seek shareholder approval to cancel its AIM admission
at the AGM to be held on 29 May 2015. If approved, the expected
date of cancellation of admission to trading on AIM would be 8 June
2015.
Cancellation of the AIM admission would not affect the ASX
listing. The Company envisages that its shares will remain
suspended on the ASX until such time as the Company completes a
transaction and seeks re-compliance for listing on the ASX.
With our available cash reserves, Leyshon is well positioned to
pursue quality projects in accordance with its investment strategy.
Every effort will be made to ensure we secure assets that are most
likely to achieve the corporate objectives and strategic aims of
the Company.
In the interim, the Company will continue to evaluate suitable
investment opportunities and will keep the market informed of any
material developments as they occur.
For further information please contact:
Leyshon Resources Limited
Corey Nolan - Managing Director
Tel: +61 7 3221 7770
admin@leyshonresources.com
RFC Ambrian Limited
Samantha Harrison (Nominated Adviser)
Kim Eckhof (Corporate broking)
Tel: +44 (0)203 440 6800
http://www.leyshonresources.com
Tenement Interests
Leyshon Resources Limited held the following interests in
exploration tenements at the end of the quarter. There were no
tenements acquired or disposed of during the quarter and no changes
in the beneficial interests held by the Company.
PROJECT BENEFICIAL INTEREST TENEMENT NAME
MOUNT LEYSHON 100% ML 1546 Golden Star
100% ML 10144 Mt Leyshon
100% ML 10148 Puddler Creek
100% ML 10149 Water Dam Gap Creek
100% ML 10172 Eastern Star
100% ML 10173 Southern Star
Leyshon Resources Limited ABN 75 010 482 274
Level 3 / Suite 3, 1292 Hay Street, West Perth 6005, Western
Australia
Tel: + 61 8 9321 0077 Fax: + 61 8 9322 4073
This information is provided by RNS
The company news service from the London Stock Exchange
END
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