Bluebird Merchant Ventures (EPIC: BMV), the Asian focused resource development group is pleased to announce an update on the Company’s funding position.
- CEO, Colin Patterson, has committed to personally fund the Gubong project through to completion of the Report on Feasibility to re-open the Gubong mine
- “Soft loans” of USD 500,000 made to the Company by management and key associates have been extended
- Assay results from underground and surface sampling are expected in early January
The Company is delighted with the progress that has been made at the Gubong project as Bluebird looks to reopen what was South Korea’s second largest old gold mine. In order for a 50:50 contributing Joint Venture to be formed with our partner, Southern Gold, Bluebird has to spend USD 500,000 at Gubong in order to produce a Report on Feasibility of re-opening the mine. In addition, Colin Patterson undertook the AUD 250,000 Southern Gold placement on behalf of the Company, as required by the Gubong agreement. Colin has also repeatedly stated the Company does not intend to Place shares in Bluebird until the share price reflects what the Directors believe is reasonable value for the Gubong Project. The position of the Company remains unchanged and despite being pleased that the share price has increased since taking on the Gubong project, the Directors are still of the opinion that the market is undervaluing the Company. As such, Colin has committed to fund the Gubong project through to producing the required Report on Feasibility which is the pre-construction stage of the project, or until the share price reflects what the Directors believe is reasonable value.
Management and key associates have contributed the full USD 500,000 as “soft loans” to the Company in units of USD 50,000 as was announced on the 10 April 2017. The loans were to be drawndown in stages as the project required. The “soft loans” carried an 8% per annum coupon (to be paid in shares at market price) and 250,000 warrants to be issued upon maturity of the loan at a 2p exercise price with a maturity date of 12 months from issuance. The maturity date of all the loans has been extended to various dates from May 2018 onwards depending on the respective drawdown schedule.
The Gubong project continues to be funded from drawdowns of the soft loans. Bluebird expects to complete the Report on Feasibility of re-opening the Gubong mine by the end of Q2 2018 and is delighted with the recent progress that has been made.
Furthermore, the Company announced on 27 March 2017 that both CEO, Colin Patterson and Director, Aidan Bishop offered to take 100% of their respective remuneration in the form of shares rather than cash. This offer was accepted. As yet no shares have been issued. The Company also implemented a salary sacrifice mechanism whereby the Board and key management could participate. This has resulted in the cash component of Board remuneration to be reduced to minimal levels.
The company believes that 2018 will be a very exciting year for our project in South Korea and that shareholders will be delighted with the results. The Company is expecting to receive some very encouraging assay results from both underground and surface sampling in early January.
Colin Patterson, CEO, commented:
“I strongly believe in both the potential and value of the Gubong project in South Korea as has been demonstrated by my personal commitment and that of the Board and management of Bluebird. We have a highly experienced team who have re-opened mines in various parts of the world and the Gubong project excites me, equally, if not more so, than previous projects that I have undertaken.”
“I am convinced that we will create value for shareholders. To demonstrate my confidence I have offered to the Board to personally fund up to USD 700,000 in order to see the project through to the formation of the Joint Venture at Gubong, which is the pre-construction stage and in addition to fund a second exciting project in South Korea that we are considering through to the formation of a Joint Venture and pre-construction stage. As such I remain confident with regards to the financial future of the Company as well as in the value and enormous potential of the Gubong project.”
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF THE MARKET ABUSE REGULATION EU 596/2014 (“MAR”)