African Mining and Exploration Plc ('AME' or 'the Company')

Equity Investment of £500,000 and Strategic Target Expansion

African Mining and Exploration plc, the listed (AIM: AME) minerals exploration and development company, is pleased to announce a capital raising of up to £500,000 in AME by the recently appointed Director, David Archer to take advantage of opportunities made available as a result of the current investment climate.

Highlights:

·    Recently appointed Director will make an equity investment of up to £500,000 in the Company

·    Increased emphasis on acquisition of projects with diversified mineral and geographical focus

·    Continued focus on cash management

·    Appointment of Technical Project Leader

AME CEO, Mark Jones said: "David was identified and appointed as a Director of AME because of his extensive knowledge of the resources industry which augmented an already experienced Board. This investment by David and the appointment of a Technical Project Leader are the first steps in what we expect to become a transformational process as AME seeks to place itself in a strong position to benefit from opportunities resulting from the current investment climates prevalent in both the juniors and majors."

£500,000 Equity Investment

The Company has entered into a share subscription agreement with David Archer, a Company Director, who will be issued with 16,666,668 new ordinary shares in the Company, at a price of £0.0225, for a consideration of £375,000.03. In line with the agreement these new ordinary shares will be issued on receipt of payment later this week. This represents approximately 16.5% of the Company's expanded share capital.

Additionally, subject to shareholder approval, he will make a further investment of £125,000 for 5,555,556 new ordinary shares in the Company, at a price of £0.0225. The shareholder approval required to change the share allotment authorities will be sought at an EGM in due course.

As part of the subscription agreement David Archer will also be issued with 1 warrant per share subscribed to, up to 11,111,112 warrants with an exercise price of £0.03 which is at a premium of 1.125p (60%) above the Company's mid-market share price at close of trading on 19 July 2013. The warrants will have an exercise period of 5 years and would represent about 10.4% of the Company's expanded share capital after the £500,000 equity investment. A quantity of 4,678,224 warrants will be issued upon receipt of the £375,000.03 and the balance of 6,432,888 warrants is subject to shareholder approval. The shareholder approval required to change the equity securities allotment authorities will be sought at an EGM in due course.

Application will be made for the new Ordinary Shares to be admitted to trading on AIM ("Admission").  Admission is expected to occur at 8.00 a.m. on 26 July 2013.  Following Admission, the total number of voting rights in the Company will be 100,879,974 Ordinary Shares.  This number may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company under the FSA's Disclosure and Transparency Rules.

As a director of the Company, the issue of shares and warrants to David Archer pursuant to the subscription agreement is classified under the AIM Rules as a related party transaction.  The directors of AME, having consulted with the Company's nominated adviser, N 1 Singer, consider that the terms of the transaction are fair and reasonable insofar as the Company's shareholders are concerned.  

This injection of funding will support of the Company's modified strategy as detailed below.

Strategic Target Expansion

In the Chairman's Statement in the 2012 Annual Report, it was stated the Company sought to build shareholder value by: "establishing a leading exploration company" and "utilising the Board and management team's global experience to continue to expand AME's portfolio of assets through the judicious selection and acquisition of projects with low entry costs". This continues to be the case, but the Board remains cognisant of the difficulties that the junior exploration sector is facing in seeking finance for projects and has decided that the Company should expand its strategic focus. This means that in addition to taking "a more expansive approach to geographical coverage", as also noted in the Chairman's Statement in the 2012 Annual Report, the Company will be seeking mineral exploration and development projects which may include, but will not be limited to the previous focus of gold exploration in West Africa. The primary consideration in project selection will be the ability to effectively fund the required level of exploration and development costs.

The capital expenditure moratoriums introduced by many of the majors is expected to provide opportunities to acquire quality projects at relatively advanced levels of development. It is expected these projects may become available at low cost and AME's new strategy seeks to position the Company so that it is able to take advantage of such opportunities.

Cash Management

The Company's focus on prudent cash management will continue, and the emphasis on non-cash remuneration will increase. In line with this the Company announces an agreement, which is subject to shareholder approval, to issue 4,500,000 share options with an exercise price of £0.03 as non cash remuneration. 1,500,000 of the share options will be issued to Michael Johnson and 1,500,000 to Charlie Cannon-Brookes, both of whom are Non-Executive Directors of the Company and currently receive a nominal fee of £1 per annum. The performance conditions attached to the share options are that one sixth of the quantity granted will vest at the end of each month of completed service over the next 6 months and have an exercise period of 5 years. The shareholder approval required to change the equity securities allotment authorities will be sought at an EGM in due course.

Technical  Project Leader

In support of the broadening of AME's strategic focus, the Company is pleased to announce the appointment of Dale Ferguson as Technical Project Leader. Dale is an experienced geologist with significant experience in the commercial aspects of exploration and development projects. In substitution for a reduced cash remuneration Dale has be granted 5,321,776 share options with an exercise price of £0.03. The performance conditions attached to the share options are that one twelfth of the quantity granted will vest at the end of each month of completed service over the next 12 months and have an exercise period of 5 years.

**Ends**

For further information please visit www.ameplc.co.uk or contact: