BullsEye Insights

BullsEye: Daily London AIM RNS Round-Up

Wednesday 15 April 2020

Here is our summary of the day's hottest RNS alerts from across London's Alternative Investments Market (AIM).

Castleton Tech PLC (CST.L)

Recommended Cash Offer for Castleton Technology

The boards of MRI Software LLC and MRI Software Limited (Bidco) and the board of directors of Castleton Technology plc are pleased to announce that they have reached agreement on the terms of a recommended cash offer to be made by Bidco for the entire issued and to be issued ordinary share capital of Castleton .

  • The Acquisition will be implemented by way of a scheme of arrangement.

  • Under the terms of the Acquisition, each Castleton Shareholder will be entitled to receive: for each Castleton Share: 95 pence in cash.

  • The Acquisition price represents a premium of approximately:

  • 42.9 per cent. to the undisturbed Closing Price of 66.5 pence per Castleton Share on 14 April 2020 (being the last Business Day prior to the date of this announcement);

  • 35.2 per cent. to the three month volume weighted average price of 70.3 pence per Castleton Share to 14 April 2020 (being the last Business Day before the date of this announcement); and

  • 42.1 per cent. to the six month volume weighted average price of 66.9 pence per Castleton Share to 14 April 2020 (being the last Business Day before the date of this announcement).

  • The Acquisition values the entire issued and to be issued ordinary share capital of Castleton at approximately £82.8 million on a fully diluted basis.

  • If, on or after the date of this announcement, any dividend and/or other distribution and/or other return of capital is declared, made or paid or becomes payable in respect of the Castleton Shares, Bidco reserves the right to reduce the consideration payable under the terms of the Acquisition for the Castleton Shares by an amount up to the amount of such dividend and/or distribution and/or return of capital, in which case any reference in this announcement to the consideration payable under the terms of the Acquisition will be deemed to be a reference to the consideration as so reduced.

For the full RNS, see: https://www.investegate.co.uk/mri-software-limited/rns/recommended-cash-offer-for-castleton-technology/202004150700076563J/

(2) Trading Update

Castleton Technology plc also announced its trading update in addition to the news regarding the receipt of a cash offer.

Castleton expects to report revenue of not less that £23.3 million for the year to 31 March 2020. This level of revenue would be marginally behind management expectations and, accordingly, it is expected that adjusted EBITDA will also be marginally behind management's expectations. Cash generation for the period remained solid and this facilitated a continued reduction in the Company's net debt.

The Company's contracted backlog has increased by £1.6 million over the course of the year to £32.5 million as at 31 March 2020, although it also experienced a small amount of churn in its customer base. Amongst other risks to the business, the unknown duration and extent of the macro and micro economic consequences of the COVID-19 pandemic makes predicting future near term demand for the Company's offerings difficult at this stage. However, it is worth noting that approximately 67% of the Company's revenue for the year to 31 March 2020 was recurring in nature, providing a base level of revenue visibility for the future.

For the full RNS, see: https://www.investegate.co.uk/castleton-technology/rns/recommended-cash-offer---trading-update/202004150700076562J/

Reaabold Resources (RBD.L)

Commencement of Activity at West Newton B Site

Reabold, the AIM investing company which focuses on investments in pre-cash flow upstream oil and gas projects, updated the market regarding the start of preparatory activity ahead of drilling at the West Newton B site in PEDL 183, onshore UK.

Following the oil and gas discovery made at the West Newton A-2 well in 2019, the focus of activity on the license will be on appraising the potentially significant resources that have been discovered as well as testing further potential in the identified exploration targets. Key to this programme is the drilling at the West Newton B site, which will both further appraise the discovery made in the Kirkham Abbey formation, as well as target the deeper Cadeby formation, where oil shows were encountered from the drilling at West Newton A. The 2020 programme also includes the planned testing at the A-2 well.

At West Newton B, Rathlin Energy (UK) Ltd ("Rathlin"), the O perator of the project, is now conducting preparatory work at the site in compliance with landowner and regulatory agreements, and consistent with government guidance on COVID-19. Initial operations involve the completion of the access track and site along with activities that are pre-operational conditions of Rathlin's Environment Agency and East Riding of Yorkshire Council (ERYC) permissions.

Such activities are consistent with the works envisaged to be carried out at West Newton B site during Q2 2020 announced by the Company on 20 February 2020. Reabold holds an approximate 39 per cent. effective economic interest in West Newton via its 59 per cent. equity interest in Rathlin, which is fully funded for activity across both A and B sites.

For full RNS details, see: https://www.investegate.co.uk/reabold-resources--rbd-/rns/commencement-of-activity-at-west-newton-b-site/202004150700076546J/

Bluejay Mining Plc (JAY.L)

Two New Exploration Licences in South Greenland

Bluejay Mining plc, a Greenland focused exploration and development company, announced that it has been awarded two new Mineral Exploration Licences in South Greenland by theMineral Licence and Safety Authority, Greenland ('MLSA').  

The Licences cover a total of 2,025 km2 near the southern tip of Greenland that is highly prospective for several commodities, including gold, base metals and uranium.  The Licences, to be known as the Thunderstone Project, complement the Company's existing resource portfolio and further strengthens Bluejay's leading position in Greenland.

  • Two new Mineral Exploration Licences applied for in 2019 (MEL 2020/03 and 2020/22) totalling 2,025 km2 have now been awarded in South Greenland

  • The Licences were identified as prospective following the re-evaluation of geological models, compilation of all available geological, geochemical and geophysical information and anomalies defined from a newly acquired geochemical exploration dataset

  • Thunderstone is highly prospective for base-metals, especially zinc, with additional significant potential for large-scale gold and uranium occurrences

  • Historical stream sediment and heavy mineral concentrate sampling has identified the Project as one of the most anomalous areas in the whole of Greenland for zinc

  • The Licences will hold no financial commitments for the Company in 2020 - the Government of Greenland has recently approved the adjustment of mineral exploration obligations for 2020 for all exclusive exploration licences (including special exploration licences) to zero, regardless of licence age, in response to the COVID-19 pandemic

For full RNS details, see: https://www.investegate.co.uk/bluejay-mining-plc--jay-/rns/two-new-exploration-licences-in-south-greenland/202004150700066481J/

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