Watson Farley & Williams (“WFW”) advised ACAM LP on an investment of £2m into AIM-listed metals exploration company Power Metal Resources Plc (“Power Metal Resources”) through a subscription for 10% per annum fixed rate interest loan notes. ACAM LP was also issued 13,333,333 warrants over ordinary shares in Power Metal Resources exercisable at 15p per share subject to standard adjustment provisions.
The transaction also involves a non-binding term sheet to form a joint venture (“JV”) including Power Metal Resources’ entire portfolio of uranium licenses. The potential investment could extend to £10m, enabling substantial exploration funding. It is currently intended that ACAM LP (or an affiliate) will make an initial equity investment of £10m into Power Metal Resources’ wholly owned Canadian subsidiary, Power Metal Resources Canada Inc (“PMC”) for a majority interest in PMC of 70%. Power Metal Resources will receive an additional cash payment of up to £4m, conditional upon a sale transaction completing or other value realisation by ACAM LP (or its affiliate), subject to achieving a minimum return threshold on its investment.
ACAM LP is a natural resource focussed limited partnership which is advised by S&F Investment Advisors Limited.
Power Metal Resources is a metals exploration company that finances and manages global resource projects and is seeking large-scale metal discoveries. Its projects range from early-stage greenfield exploration to later-stage prospects subject to drill programmes.
The WFW London Corporate team that advised ACAM LP was led by Partner Tony Edwards supported by Associate Jonathan Ford. Tony Edwards and the team, working closely with London Projects Partner Daisy East and Associate Oli Baines, also advised ECAM LP (an affiliate of ACAM LP) last year on its investment in Amaroq Minerals by way of US$16m convertible notes which formed part of a US$50.9m senior secured financing package.
Tony commented: “We’re delighted to have once again advised ACAM LP on an investment in the junior listed mining company space, an area that has not received the attention it deserves from many mainstream institutional investors. We were able to complete the legal work in just a week which is a testament to the unrivalled expertise we offer clients in the natural resources sector across all key service lines”.
