Ascent Resources PLC Announces Intention to Bid for Amur Minerals Corporation Shares

This announcement contains inside information for the purposes of Article 7 of the UK version of Regulation (EU) No 596/2014 which is part of UK law by virtue of the European Union (Withdrawal) Act 2018, as amended ("MAR"). Upon the publication of this announcement via a Regulatory Information Service, this inside information is now considered to be in the public domain.

1 June 2023

Ascent Resources plc

Intention to bid for Amur Minerals Corporation

The board of directors of Ascent Resources Plc ("Ascent" or, the "Company"), the European and Latin American focused natural resources company, is pleased to announce their intention to bid for the entire issued and to be issued share capital of Amur Minerals Corporation ("Amur" or, the "Target Company") following a period of protracted discussions with the Board of Amur. 

Ascent's vision is that Ascent and Amur would combine to form a larger, well funded and more liquid, entity combining Amur's cash (post the recently announced asset sale and subsequent dividend) with Ascent's ESG Metals project pipeline in LATAM, which typically have low geological risk and near term and sustainable cashflows, in addition to the significant upside exposure of Ascent's funded EURO 500+ million Energy Charter Treaty damages claim (the "PotentialCombination").  

Ascent submitted a non-binding indicative proposal to the Board of Amur in November 2022 to acquire 100% of the issued and to be issued share capital of Amur (post payment of its dividend as subsequently announced 24 May 2023) in a share-for-share exchange on a ratio of approximately 1 new Ascent share for every 21 Amur shares in issue (the "Exchange Ratio") (subject to the reservations set out below) (the "Indicative Proposal").  On the assumption that Amur only has assets of $5,000,000 in cash (post payment of dividend) and no further material liabilities, the indicative proposal is equivalent to a gross equity valuation of 6.1 pence per new Ascent share (based on an exchange rate of $1 = £0.8051).   Despite multiple conversations with the Board of Amur and multiple follow up correspondence, the Company has as yet been unable to elicit a written response to their offer.

The Indicative Proposal also included the intention to combine the skills of both executive teams, as well as other potential changes to the enlarged groups non-executive directors. It is intended that the enlarged group would have a majority of board directors from Ascent.

The Exchange Ratio, based on Ascents volume weighted average share price of 3.6716 pence yesterday, being the last business day immediately prior to the date of this announcement, currently represents a value of approximately 0.175 pence per Amur share.

At the current value of approximately 0.175 pence per Amur share implied by the Exchange Ratio, a potential offer, if made, when added to the 1.8 pence dividend to be paid by Amur would represent a premium of approximately:

·     7.3 per cent. to the Amur closing price of 1.840 pence per share on 31 May 2023, being the last business day immediately prior to this announcement;

·    15.3 per cent. to the monthly average volume weighted average price calculations for Amur shares over the three-month period starting on and including 1 March 2023, being 1.713 pence per share; and

·    47.5 per cent. to the monthly average volume weighted average price for Amur shares over the six-month period starting on and including 1 December 2022, being 1.339 pence per share

Under the terms of the Indicative Proposal, it is expected that Amur shareholders would own approximately 28.6 per cent. of the enlarged group, and Ascent shareholders would own approximately 71.4 per cent. of the enlarged group.

Given the Indicative Proposal is currently proposed to be structured as an share-for-share exchange effected by either scheme of arrangement or plan of arrangement, Ascent is currently only minded to proceed with the Indicative Proposal on the pre-condition that a recommendation from the Amur Board is ultimately forthcoming.

The Company believes that the combination would be a strategically compelling proposition for both sets of shareholders at this moment in time, resulting in the combination of two complementary businesses, with a new well funded LATAM focused metals processing businesses emerging from the combination supported by Amur's remaining cash balance (post dividend) as well as Ascents funded €500+ million monetary damages claim. The Company believes that the combined shareholder group would benefit from dovetailing industrial capital with metals processing business development inventory, in a scaled and well funded enlarged entity with greater breadth of shareholders and positioned to be exposed to multiple near and long term business catalysts in play and to be achieved.

Amur is a British Virgin Islands incorporated corporation and is not subject to the UK City Code on Takeovers and Mergers, nor is it subject to any similar legislation or code in its country of incorporation. Amur has voluntarily adopted similar provisions to the UL City Code on Takeovers and Mergers in Clauses 143 to 149 (inclusive) of the Articles of Association. At this stage, there can be no certainty that a binding offer will be made.

Further announcements will be made as appropriate.

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Important notices

WH Ireland Limited, which is regulated by the Financial Conduct Authority in the United Kingdom, is acting exclusively forAscent Resources Plcand no one else in connection with the matters referred to in this announcement and will not be responsible to anyone other than Ascent ResourcesPlc for providing the protections afforded to clients of WH Ireland, or for providing advice in relation to the matters referred to in this announcement.

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