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UPDATE 1-African Copper gets funding, shares rise

* To sell 4.4 mln stg of shares to Natasa

* Gets $8.5 million loan facility

* In debt-for-equity swap for 16.1 mln stg of loans

* Shares rise as much as 20 pct (Adds details)

April 9 (Reuters) - African Copper Plc ACU.L said on Thursday its shareholder Natasa Mining Ltd NSN.L had agreed to inject the much-needed funding via a 4.4 million pounds share purchase and an $8.5 million loan facility.

It would also issue about 5.3 million new shares in swap deal to settle 16.1 million pounds of debt, the company, which has no income currently as its principal Mowana Mine in Botswana is on care and maintenance, said in a statement.

The company said the low copper prices are expected to remain weak in the near term and “the group is therefore dependent on the injection of funding by Natasa pursuant to the proposals to enable it to continue to trade”.

African Copper said it would issue about 15.8 million shares at 27.9 pence each to investment company Natasa, lifting its stake to 70 percent of the enlarged share capital.

Upon completion of the deal, African Copper’s current board will step down and Natasa’s nominees Chrisilios Kyriakou and Jonathan Reynolds would become chairman and chief financial officer, respectively, it said.

The proceeds of the subscription and the loan facility will be used to repay debt and as working capital, it said.

Natasa has already made available $1.5 million short-term loan under the facility and has also agreed to assume $2.1 million of African Copper’s debt, the company said.

African Copper suffered a net loss of 102 million pounds in 2008 due to fall in demand and price for copper worldwide during the fourth quarter, and shipping delays.

It had 1.76 million pounds in cash and a working capital deficit of 23.3 million pounds as on Dec. 31.

Shares of African Copper closed up 13.33 percent at 2.125 pence, while Natasa Mining shares closed down 3.85 percent at 62.5 pence on the London Stock Exchange. ($1=.6811 Pound) (Reporting by Ramkumar in Bangalore; Editing by Gopakumar Warrier)

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