Ariana Resources raises 1.25m pounds to develop Red Rabbit project

17th Jun 2013 11:47

AIM-listed exploration and development company Ariana Resources has conditionally raised 1.25m pounds before expenses by way of a subscription by Lanstead Capital L.P.An update issued by the company stated that Lanstead, an institutional investor, had subscribed for 125m new ordinary shares of 1.0p each at 1.0p per share for an aggregate consideration of £1.25m. In addition, the company said that it had entered into an equity swap agreement with Lanstead, which would allow Ariana Resources to retain much of the economic interest in the Lanstead subscription shares. Of the subscription proceeds of £1.25m, the company said it would use £250,000 for working capital and £1.0m for investment in the equity swap under the agreement. The company said that it would also issue 12.5m new ordinary shares to Lanstead in consideration for the equity swap agreement. The funds would be used by the company to help develop its Red Rabbit project in western Turkey, to continue exploration on the wider Red Rabbit project area and for general working capital.Dr. Kerim Sener, Managing Director of Ariana Resources, said: "We are pleased to welcome Lanstead Capital as shareholders in the company and look forward to advancing the development of the Kiziltepe Sector of the Red Rabbit project through environmental certification and on to construction." He added: "The investment from Lanstead Capital comes at an important time in the development of the company and provides us with sufficient capital to proceed to the construction phase of the Kiziltepe mine as the company progresses its near term intention to become a producer." Ariana Resources' share price was down 2.22% to 1.10p at 13:11 on Monday.MF