Quarterly Report 30 June 2009
July 20 2009 - 2:26AM
UK Regulatory
TIDMDWY
RNS Number : 9271V
Dwyka Resources Limited
20 July 2009
DWYKA RESOURCES LIMITED (ASX:DWY.AX; AIM:DWY.L)
Highlights during the Quarter
Corporate
* Takeover offer made for AIM-listed Minerva Resources Plc ("Minerva") on the
basis of 1 Dwyka share for every 5 Minerva shares
* Offer for Minerva declared wholly unconditional on 14 July 2009 with 80.9%
acceptances
* Cash balance at 30 June 2009 GBP6.3 million (AUD12.8 million)
Muremera Nickel Project in Burundi
* Drilling commences at 3 highest priority targets near Kabanga
* Renewal of Muremera project licence secured
TAKEOVER OFFER FOR MINERVA
On 23 June 2009, Dwyka announced the making of a takeover offer to acquire all
of the issued and to be issued share capital of Minerva, on the basis of
offering one Dwyka share for every five Minerva shares (the "Offer"). The Offer
was recommended by the Board of Minerva and valued the entire issued capital of
Minerva at approximately GBP1.8 million and each Minerva share at approximately
1.2 pence.
Minerva's principal assets are a portfolio of gold and platinum licences located
in Ethiopia, although it also has other mineral interests in Sierra Leone.
Having considered in excess of 40 potential acquisition opportunities in the
preceding 18 months, the Dwyka Directors believed that the acquisition of
Minerva, together with the combination of Minerva's assets, Dwyka's in-house
experience and Dwyka's financial resources, had strong commercial logic, and
strategic drivers, including the following:
* Gold represents a resource commodity that is likely to remain in high demand and
retain mid to long-term pricing. A further investment in gold would fit with
Dwyka's other assets.
* The acquisition of Minerva would increase Dwyka's gold exposure on the African
continent and provide a means of raising the profile and prospects for Dwyka's
existing gold assets. Additionally the Minerva assets would shift the Company's
primary focus from being an explorer to becoming a developer.
* Dwyka believed the acquisition of Minerva would represent an opportunity to
define a JORC resource in the near term based on the work performed by Minerva
to date and thereafter to grow the resource through further exploration with the
aim of establishing a low cost gold mining operation.
* Minerva's Tula Kapi Prospect and Guji, Gudeya Guji and Dina Prospects had a
simple geological structure and metallurgy which would potentially reduce the
costs of exploration and future extraction of ore.
* The historical work and the subsequent results achieved by Minerva were
sufficiently far advanced to provide Dwyka with an opportunity to accelerate
scoping and feasibility studies with a view to developing a producing gold mine.
* The legislative environment in Ethiopia was recognised as being one of more
conducive in Africa towards foreign investment and mining operations.
* The acquisition of Minerva would potentially provide a significantly shorter
lead time to first gold production for Dwyka and a share-based takeover offer
represented the most effective route for Dwyka to achieve this, preserving
Dwyka's cash reserves.
Since the end of the Quarter, Dwyka announced on 15 July 2009 that it had
received acceptances in respect of 80.9% of the Minerva issued share
capital ("Minerva Shares") and that it had declared the Offer wholly
unconditional. Following that announcement, the previous Board of Minerva
resigned and was replaced with a Board comprised wholly of Dwyka appointees. At
this point in time, the Offer remains open for acceptance until 28 July 2009
and, should Dwyka receive acceptances in respect of a total of 90% of the
Minerva Shares, it will be entitled to compulsorily acquire the outstanding
Minerva Shares so as to become the 100% owner of Minerva. As Dwyka is now the
owner of more than 75% of the Minerva Shares, Minerva will be de-listed from AIM
in accordance with the AIM Rules. It is expected that this de-listing will occur
on 23 July 2009.
Subsequent to the end of the quarter, Dwyka management has worked to finalise
and commence a work programme for the Minerva assets. Details of this work
programme will be announced shortly.
MUREMERA PROJECT
During the previous Quarter, Dwyka announced that it had secured 100% ownership
of the Muremera Nickel Project ("Project") through its wholly owned subsidiary
Danyland Limited and that it had identified the three highest priority targets
in its exploration programme for drilling. Those targets, located approximately
10km from the Barrick/Xstrata Kabanga Project ("Kabanga"), currently the world's
largest undeveloped nickel sulphide project, were identified from the intensive
VTEM surveys undertaken to date and were generated from VTEM signatures
consistent with massive sulphide bodies that may have a nickel signature.
Drilling commenced during the quarter.
Renewal documentation in relation to the Project licence was submitted during
the quarter to the Burundi authorities and, subsequent to the end of the
quarter, it was confirmed that the renewal had been granted. The Decree which
formally grants the renewal is due to be delivered. As a result, the current
exploration licence is valid for a further period of two years.
SWAZIGOLD PROJECT
A project review which will allow Dwyka to determine whether Dwyka will continue
to sole fund further exploration of the project (to increase its ownership
level) or pursue other joint venture mechanisms to progress the project to the
next stage is almost complete. A decision regarding future funding of this
project should be forthcoming shortly.
Application was made during the quarter for the renewal of the SwaziGold Project
licence. The renewal remains pending but is expected to be confirmed shortly.
MELISSA STURGESS
Chief Executive Officer
Enquiries:
Melissa Sturgess
Dwyka Resources Limited
+44 (0)7825 551 397 or melissa@dwyresources.com
In the United Kingdom
Richard Brown
Ambrian Partners Limited
+44 (0)20 7634 4700
Press enquiries
Charlie Geller/Leesa Peters
Conduit PR
+44 (0)20 7429 6604 or +44 (0) 79 7006 7320
or visit http://www.dwyresources.com
This information is provided by RNS
The company news service from the London Stock Exchange
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