- £4m equity and warrant raise entity amended from BVI registered Wealth Rank Ltd to China registered timber trading company Jiangsu Dolphin International Trading Co Ltd
- All terms remain the same to those announced on 28th April 2017 except closing date now amended to 30th June 2017
- The Company is also working to finalise a substantial wood order with Jiangsu Dolphin International Trading Co Ltd
Obtala Limited (AIM: OBT), the African focused agricultural and forestry company, is pleased to announce that it has today agreed to amend the subscription entity announced on 28th April 2017 from Wealth Rank Limited (“WRL”) to Jiangsu Dolphin International Trading Co Ltd (“JDIT”). The terms to issue 20,000,000 new Ordinary Shares of 1p each in the capital of the Company (“Ordinary Shares”) for a total cash subscription price of £4,000,000, equivalent to a price of 20p per share, remain the same except the subscription is expected to close on 30 June 2017, and is conditional on receipt of the subscription monies and various administrative conditions including no suspension of trading in Obtala ordinary shares in the 30 day trading period prior to close.
Application will be made for the 20,000,000 new Ordinary Shares, which will on issue rank pari passu with the Company’s existing issued ordinary shares, to be admitted to trading on AIM. It is expected that admission will become effective on or around 5 July 2017.
Following the issue, the enlarged issued share capital of the Company with voting rights attached will consist of 297,637,768 Ordinary Shares of 1p each with one vote per share. There are 99,378 Ordinary Shares held in Treasury. Therefore the total number of voting rights in the Company will be of 297,737,146. This figure may be used by shareholders (and others with notification requirements) as the denominator for the calculations by which they will determine whether they are required to notify their interest, or a change to their interest, in the Company under the Financial Conduct Authority’s Disclosure Guidance and Transparency Rules or otherwise.
The new Ordinary Shares represent approximately 7.2 per cent. of Obtala’s existing issued ordinary share capital and will on issue represent approximately 6.7 per cent. of its enlarged issued ordinary share capital, being JDIT’s total holding of Obtala ordinary shares.
Issue of warrants
In accordance with the terms of the subscription agreement, on completion of the subscription the Company will issue warrants to subscribe for up to 20,000,000 new Obtala ordinary shares to JDIT at a price of 20 pence per share in accordance with the terms of a warrant instrument under which warrants will exercisable immediately upon issue until 1st November 2018. Any exercise of Warrants shall be in multiples of 5,000,000 Warrants. The warrants will not be transferable save to any member of the JDIT Group as defined in the warrant instrument.
Miles Pelham, Chairman of Obtala, commented: “It gives me great pleasure to announce that Jiangsu Dolphin International Trading Co will be joining our shareholder register. Together we will expend maximum energies to build a fruitful trading partnership selling our sawn timber and also higher-value wood products for the betterment of all stakeholders.
“JDIT’s investment illustrates the clear value in our standing timber as we move to monetize assets via a ramp up of production throughout 2017 and into 2018 with our substantial sawmill in Nampula coming online towards the end of this year. It is encouraging that major investors have the confidence in the management structures and processes we have put in place to unlock and monetize value in Africa.
“JDIT is the third Asian based trading house to make a substantial investment in the past 6 months with 2 trading houses taking sizable stakes in our Argento Preference Share issue, as announced on 1st Dec 2016. The desire from trading professionals to gain access to underlying commodity assets bodes well for the medium-term supply/demand outlook of precious wood species.”