African Gold Group announces closing of strategic investment, acquisition

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By Ted Liu

African Gold Group, Inc. (TSX-V: AGG) has completed the previously announced financing whereby Forbes & Manhattan Resources Inc., certain other investors, and certain insiders have subscribed to a private placement of 74,827,188 units at $0.09 per unit for gross proceeds of $6,734,446.92.

Each unit consists of one common share and one common share purchase warrant entitling the holder to purchase one additional common share at a price of $0.12 per share for a period of thirty-six months from the date of closing.

African Gold Group paid a cash fee of $306,600 and issued 3,406,666 compensation warrants to GMP Securities L.P. and Delano Capital Corp. for financial advisory services completed in connection with the offering. Each compensation warrant entitles the holder to acquire one unit at $0.09 for a period of twenty-four months from the date of closing, with each unit being issued on the same terms as under the offering.

In conjunction with the closing of the financing, Stan Bharti (as Chairman), Bruce Humphrey, John Begeman and Stephan Theron have joined AGG board, replacing David Brown, Michael A.J. Nikiforuk, Dr. Antony Harwood and Pierre Lalande, who have resigned from the board.

Stephan Theron has been appointed as new CEO and Brett Richards as the new President & COO, effective immediately. Jaimie MacPherson, current CFO will remain on in a transition capacity for the next three months, at which time Ryan Ptolemy will become CFO of the company.

“We are pleased with the closing of our previously announced financing with Forbes and Manhattan and look forward to our renewed focus on our Kobada Project. I would also like to extend my sincerest thanks and appreciation to the board members of AGG who are departing the Company today. Their contributions and guidance over the years have proven invaluable for the advancement of Kobada and we wish them the best,” said Declan Franzmann, departing CEO.

African Gold Group has also executed a binding term sheet dated April 24, 2017 with 2516232 Ontario Inc. whereby it has agreed to acquire all of the issued and outstanding securities in exchange for an aggregate of 33,333,333 common shares at a deemed price of $0.09 per share for a total acquisition price of $3,000,000.

2516232 Ontario is party to an option agreement with TEMFOR s.a.r.l. providing 2516232 Ontario with the option to acquire from TEMFOR, the Madougou gold project located in Burkina Faso. Madougou is a mid-stage exploration project, located in the north-western region of Burkina Faso. The project has been extensively explored, with both ground and airborne geophysical surveys conducted, and over 20,000m of RC drilling completed on the 182km2 land package.

African Gold Group is a Canadian exploration and development company with its focus on West Africa. African Gold Group is focused on the development of the Kobada Gold Project in Mali, a low capital and operating cost gold project with potential to produce more than 50,000 ounces of gold per annum.

photo credit: African Gold Group