African Eagle Resources plc : Notice of AGM and proposed Subdivision of share capital

 African Eagle Resources plc ("African Eagle" or the "Company") (AIM: AFE; AltX: AEA) announces that it has today posted to shareholders a circular containing the Company's Notice of Annual General Meeting ("AGM") to be held at 9.30 a.m. on Monday, 24 June 2013, together with a form of proxy. At the AGM, shareholders are being asked to consider, inter alia, the following item of substantive business: * The proposed subdivision of each existing ordinary share of £0...

 African Eagle Resources plc ("African Eagle" or the "Company") (AIM: AFE; AltX: AEA) announces that it has today posted to shareholders a circular containing the Company's Notice of Annual General Meeting ("AGM") to be held at 9.30 a.m. on Monday, 24 June 2013, together with a form of proxy.

At the AGM, shareholders are being asked to consider, inter alia, the following item of substantive business:

• The proposed subdivision of each existing ordinary share of £0.01 ("Existing Ordinary Share") into one new ordinary share of £0.001 ("New Ordinary Share") and one deferred share of £0.009 ("Deferred Share") (collectively the "Subdivision").  

Subdivision

As at close of business on 29 May 2013 (the latest practical date prior to the publication of the circular), the closing share price of the Existing Ordinary Shares was £0.00825 per share, which is marginally lower than their nominal value.  Under the Companies Act 2006, it is not permissible for a company to issue shares at a discount to their nominal value and the board of directors of the African Eagle ("the Board") believes that, for so long as the share price remains at this level, the Company would be unable to raise new share capital without reducing the nominal value of the Existing Ordinary Shares.

As announced by the Company on 15 May 2013, the Directors are currently in discussions, and intend to continue discussions, with major shareholders in relation to the provision of funding for the Company and other potential transactions.  Accordingly, the Directors believe that it is important that they have sufficient flexibility to continue discussing these funding options, including providing the power for Directors to issue new ordinary shares in the Company, including for cash if required, if they determine that it is in the best interests of the Company and Shareholders as a whole to do so.

The effect of the Subdivision will be to decrease the nominal value per ordinary share by a factor of ten to £0.001. The purpose of the issue of the Deferred Shares is to ensure that the Subdivision does not result in a reduction of capital of the Company.

Upon implementation of the Subdivision, Shareholders on the register of members of the Company at the close of business on the Record Date will exchange each Existing Ordinary Share for 1 New Ordinary Share and 1 Deferred Share. The proportion of the issued ordinary share capital of the Company held by each Shareholder following the Subdivision will be unchanged.

The New Ordinary Shares arising on implementation of the Subdivision will have the same rights and benefits as the Existing Ordinary Shares, including voting, dividend and other rights.  Following the Subdivision, the number of New Ordinary Shares held by each Shareholder will be the same as the number of Existing Ordinary Shares held by them immediately before the Subdivision takes effect.  Whilst the nominal value of the New Ordinary Shares will be approximately 10 times lower than that of the Existing Ordinary Shares following the Subdivision, the overall market capitalisation of the Company is expected to remain the same.  

The Deferred Shares will not entitle holders to receive notice of or attend and vote at any general meeting of the Company or to receive a dividend or other distribution or to participate in any return on capital on a winding up other than the nominal amount paid on such shares following a substantial distribution to the holders of ordinary shares in the Company. Accordingly, the Deferred Shares will, for all practical purposes, be valueless and it is the Board's intention that, at an appropriate time, the Company may repurchase the Deferred Shares, cancel or seek to the surrender of the Deferred Shares using such lawful means as the Board may at such time determine.

Circular

The circular to shareholders in connection with the above proposal will be posted to shareholders today and contains full details of the Subdivision, together with details of the other resolutions to be proposed at the AGM. The circular, containing the Notice of Annual General Meeting, is also available from the Company's website at www.africaneagle.co.uk.

The AGM will be held at 9.30 a.m. on Monday, 24 June 2013 at the offices of Mayer Brown International LLP, 201 Bishopsgate, London, EC2M 3AF. A copy of the 2012 Annual Report is expected to be despatched to Shareholders on or around 12 June 2013.

Timetable for the AGM and the Subdivision:

 

Enquiries:

African Eagle Resources plc

Trevor Moss, CEO

+44 20 7248 6059

 

Strand Hanson Limited (NOMAD)

Stuart Faulkner

Angela Hallett

James Dance

+ 44 20 7409 3494

 

Ocean Equities Limited (Broker)

Guy Wilkes

+44 20 7786 4370

 

Russell & Associates, Johannesburg

Charmane Russell

Marion Brower

+27 11 880 3924

 

JSE Sponsor

Merchantec Capital

 

A copy of this announcement will be available on the Company's website at www.africaneagle.co.uk as soon as possible. The content of the website referred to in this announcement is not incorporated into and does not form part of this announcement.

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Attachment(s)
http://hugin.info/139385/R/1706374/564811.pdf
http://hugin.info/139385/R/1706374/564812.pdf

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