Marvel Gold to spin out Chilalo Graphite Project

Evolution intends to undertake an initial public offering (IPO) and seek a listing on the Australian Securities Exchange (ASX).

Highlights:

• Marvel to spin out the Chilalo Graphite Project into a newly incorporated, wholly owned subsidiary Evolution Energy Minerals Ltd (intended ASX code: EV1), which proposes to undertake an IPO to facilitate listing on the ASX.
• The proposed transaction seeks to unlock the value of Marvel’s 100%-owned Chilalo Graphite Project – a fully permitted, world-class graphite asset in Tanzania, with expenditure to date exceeding A$21 million.
• Proposed initial public offering of Evolution (IPO) to raise a minimum of AUS$13 million, with the potential to accept over-subscriptions.
• Castlelake, who are owed approximately AUS$9.5 million secured against Chilalo, will be paid AUS$6.5 million from IPO proceeds, with the remaining AUS$3 million being paid in cash out of IPO proceeds or in Evolution shares at the time of the IPO. All lender security over the project will be removed subject to the minimum IPO raising being achieved.
• In addition to the repayment of the existing debt, Marvel will receive between 28% and 43% of shares issued under the IPO, dependent on valuation and final amount raised.
• Marvel shareholders will receive a priority entitlement to subscribe for Evolution shares in the IPO.
• The proposed transaction is subject to shareholder and regulatory approvals – a notice of meeting has been released to the ASX, with a general meeting to be held on 11 June 2021.
• Marvel to remain focused on gold exploration in Mali.

Phil Hoskins, Managing Director, comments:

“There is no doubting the quality of the fully permitted and construction-ready Chilalo Graphite Project. Since the re-brand to Marvel and the focus on our Mali gold projects, there has been no value attributed to Chilalo despite Chilalo’s peer comparisons trading at many multiples of Marvel’s entire market capitalisation.

“The IPO of Evolution is the opportunity for Marvel to remove the historical debt encumbrance and unlock Chilalo’s value potential. Evolution has attracted three directors with significant graphite development, construction and marketing expertise, and will be well placed to add value for its shareholders through Chilalo’s development.

“Completion of the Proposed Transaction will allow Marvel to focus on its exciting Mali gold exploration. In the nine months since acquisition, we have increased Tabakorole’s resource by 54%, increased the grade of the resource by 20%, de-risked the metallurgy, and grown the landholding by 300%. Resource expansion drilling is continuing as Tabakorole continues to emerge as a significant west African gold deposit.”

Read the article online at: https://www.globalminingreview.com/mining/12052021/marvel-gold-to-spin-out-chilalo-graphite-project/