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Red Rock Resources agrees payment plan for Kenya's Mikei gold project

Published: 08:27 02 Mar 2021 GMT

Red Rock Resources PLC -

Red Rock Resources PLC (LON:RRR) has made progress towards completing the purchase of the remaining interest in the Mikei gold project in Kenya.

The natural resource development company has paid US$1mln of the US$2.5mln payment obligation, by paying US$1mln in cash to Kansai Mining Corporation Ltd, with Kansai electing to receive the balance of US$1.5mln in the form of 101.55mln new shares in Red Rock at a price of 1.05p apiece.

The issue of shares is conditional on the approval of Red Rock shareholders.

READ: Red Rock Resources completes mineral resource estimate at Mikei gold project

While planning to hold just over 49mln of the shares for long term investment, Kansai has agreed to sell almost 52.44mln of the shares to be issued to a number of private investors in a transaction arranged by Bespoke Capital Solutions Limited.

Red Rock chairman Andrew Bell said: “These payments to Kansai will complete the purchase obligations under which we acquired a 100% beneficial interest in the project and represent a milestone in the life of the company. Together with the publication of a new mineral resource estimate under the JORC 2012 Code, announced last week, this secures Kenya's position as a key asset going forward.

“The retention of a significant number of shares by Kansai will be a strong vote of confidence in our prospects. We look forward to welcoming a new shareholder with a long term perspective and a deep knowledge of the mining sector.

“The cash, share and asset position of Red Rock will be greatly strengthened by these developments, which put the company in a strong position as it prepares for drill programmes in Kenya and the DRC and an IPO for its Australian assets.”

Red Rock said it will seek approval at a general meeting for the issue of the shares and for the issue of non-tradeable warrants with a life of two years and an exercise price of 2p to be issued to Kansai or its nominees on the basis of one warrant for each two shares issued under the share payment.

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