LSE-listed Kavango has confirmed that it is in late-stage discussions for a potential exclusive two-year option to acquire a gold exploration and development project in Zimbabwe.
The project area covers several contiguous gold claims over a 3.4 km strike that has supported historic high-grade underground mining and more recent surface small-scale mining operations.
The project area has never been explored using modern methods or technology.
Provisional terms of the option would allow Kavango to perform unrestricted field due diligence – comprising exploration and drilling – ahead of deciding whether to exercise the option to acquire.
Kavango has completed extensive preliminary due diligence ahead of negotiating the deal, including two field visits to the project area.
In parallel to the new acquisition discussions, Kavango has been in discussions with a single investor concerning a possible £6-million conditional equity investment into the company through a non-brokered direct subscription.
Should terms be finalised and agreed upon, Kavango expects to complete the proposed subscription at 1p a share.
Full completion of the proposed subscription would be subject to approval by the financial conduct authority of a prospectus; approval by shareholders of a waiver; and Kavango having the necessary authorities to issue the subscription shares.