JOHANNESBURG (miningweekly.com) – Aim-quoted Lionsgold on Friday announced its £1.35m share-for-share offer to the remaining shareholders of TRAC Technology with a view to increasing Lionsgold's shareholding in Goldbloc from 55% to 100%.
“Lionsgold intends to significantly increase its ownership from the current 55% of its subsidiary TRAC Technology, the entity in which the digital gold currency Goldbloc, has been developed,” Lionsgold nonexecutive chairperson David Price commented.
He further added that Lionsgold also owned 12.5% of Railsbank, the developer of the banking and compliance platform that Goldbloc requires to be able to utilise physical gold in customers' bank accounts.
Lionsgold owns a three-year exclusive right to use the Railsbank platform for gold-related products to be transacted in bank accounts and should TRAC become a 100% wholly owned subsidiary, Lionsgold will assign that exclusive right to TRAC, creating certainty for Goldbloc, as well as future opportunities for gold-related products that can be developed within TRAC.
The Goldbloc mobile phone banking application is on schedule for release in the UK this quarter.
The Lionsgold board considers the full buy-out of TRAC to be strategically and operationally important and believes the timing of the transaction at the current valuation to be opportune as the company expects the understanding, acceptance and value of Goldbloc to increase with product rollout.
The offer has been made to all TRAC shareholders and should the value of Goldbloc increase, current TRAC shareholders who accept the offer would share in the benefit of that increase as Lionsgold shareholders, Price further mentioned.
As at June 30 last year, TRAC had an unconsolidated net asset value of £8 728 and reported an unconsolidated profit before tax for the year then ended of £3 619. As at June 30, the Real Asset, TRAC's wholly owned subsidiary, had an unconsolidated net asset deficit of £43 728 and reported an unconsolidated profit before tax for the year then ended of £7 689.
Lionsgold will provide further details upon completion of the offer, which is valid until April 20.