LionGold proposes issuance of redeemable convertible bonds

Singapore

INVESTMENT holding company LionGold Corp is proposing to issue up to S$10 million of 10 per cent unlisted and redeemable convertible bonds, comprising ten tranches of S$1 million each.

In a filing to the Singapore Exchange on Thursday, it said that it had entered into a subscription agreement with with management consultancy Tomson, which has agreed to subscribe for the bonds.

The bonds - which will be consolidated to form a single series - are due two years after the date of the first tranche's issuance. The bonds will bear interest at a rate of 10 per cent per annum, payable annually.

The bonds shall be convertible into a maximum of 3.33 billion new ordinary shares at a conversion price of S$0.003. This represents about 9.38 per cent of LionGold's enlarged share capital of 35.54 billion shares, post-conversion.

The conversion price represents a discount of about 3.23 per cent to the volume weighted average price of S$0.0031 of the company's shares, based on trades done on Dec 3, the last full market day on which the subscription agreement was signed.

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The net proceeds, after accounting for costs and expenses incurred, works out to about S$9.95 million. LionGold plans to use 70 per cent of the net proceeds to fund its growth and expansion plans, while the balance will be used for general working capital.

LionGold said: "The proposed issuance will provide the company with ready access to funds that will allow for it to finance, scale up or expand its current mining business, as and if required. The proposed issuance will also allow the company to be better positioned to capitalise on growth opportunities in the investment and fund management businesses."

The conversion shares will be issued pursuant to the general mandate approved by shareholders at LionGold's annual general meeting on Oct 30.

The sole shareholder of Tomson is Jean-Michel Paul, who was introduced to LionGold by its head of corporate investments, Yao Jiajia.

Prior to joining the company in April this year, Ms Yao worked as a lead data scientist with Real Estate Analytics, a company she co-founded with Dr Paul and a subsidiary of Tomson.

No introducer fee or placement commission has been paid or will be paid to Ms Yao for the proposed issuance, LionGold added.

Shares in LionGold closed at S$0.004 cent on Thursday, unchanged.