Correspondence 0001213900-24-081916 from Blue Gold Ltd (BGL) (CIK 0002019435) (BGL)
Blue Gold Ltd (BGL) (CIK 0002019435)
Date: Sept. 25, 2024 · CIK: 0002019435 · Accession: 0001213900-24-081916
AI Filing Summary & Sentiment
File numbers found in text: 333-280195
Referenced dates: August 2, 2024
Letter
Via Edgar Division of Corporation Finance Office of Energy and Transportation 100 F Street, NE Washington, D.C. 20549 Filed June 14, 2024 Amendment No. 1 to Registration Statement on Form F-4 Filed July 5, 2024 File No. 333-280195
Dear Messrs. Purcell and Levenberg:
On behalf of our client Blue Gold Ltd. (the “Company”), we are writing in response to your letter dated August 2, 2024 (the “Staff’s Letter”) regarding the Company’s Registration Statement on Form F-4 (the “Registration Statement”) and Amendment No. 1 to the Registration Statement on Form F-4 (“Amendment No. 1”). Concurrent herewith, we are filing Amendment No. 2 to the Company’s Registration Statement reflecting the changes set forth below (“Amendment No. 2”) as well as the requisite exhibits. For ease of reference, we have reproduced the comment below in bold with our responses following the comments.
Registration Statement on Form F-4
Questions and Answers for Shareholders of Perception, page ix
1. We note that certain shareholders agreed to waive their redemption rights. Please describe any consideration provided in exchange for this agreement.
RESPONSE: In response to the Staff’s comment, the Company respectfully advises the Staff that disclosure has been added on pages xiv, 70 and 130 to state that no additional consideration was provided to those shareholders who agreed to waive their redemption rights.
Michael Purcell Timothy Levenberg U.S. Securities & Exchange Commission
September 25, 2024
Page 2
Summary of the Proxy Statement/Prospectus, page 1
2. Please provide organizational diagrams reflecting your corporate structure prior to and upon completion of the proposed transactions.
In response to the Staff’s comment, the Company respectfully advises the Staff that it has revised the disclosure on page 4 and 143 of Amendment No. 2 to provide the requested organizational diagrams.
3. Please quantify the aggregate dollar amount and describe the nature of what the sponsor and its affiliates have at risk that depends on completion of a business combination. Include the current value of securities held, loans extended, fees due, and out-of-pocket expenses for which the sponsor and its affiliates are awaiting reimbursement. Provide similar disclosure for the company’s officers and directors, if material. For example, we note the Sponsor and Perception’s officers and directors (or their affiliates) have made loans to Perception to fund certain capital requirements.
RESPONSE: In response to the Staff’s comment, the Company respectfully advises the Staff that the aggregate dollar amount and nature of what the sponsor and its affiliates have at risk has been disclosed on pages xxii, 10, 11, 94, and 95. Please note that while the Former Sponsor had made loans for working capital purposes, in connection with the transfer of control to the Managing Sponsor in November 2023, the Former Sponsor forgave all such loans. While the Company has incurred debt since that date, no loans have been made by the Managing Sponsor or any of Perception’s officers, directors or affiliates that remain outstanding nor are any such loans contemplated.
4. Please revise to disclose all possible sources and extent of dilution that shareholders who elect not to redeem their shares may experience in connection with the business combination. Provide disclosure of the impact of each significant source of dilution, including the amount of equity held by founders, convertible securities, including warrants retained by redeeming shareholders, at each of the redemption levels detailed in your sensitivity analysis, including any needed assumptions. For example, we note your Sponsor or an affiliate of your Sponsor or certain of your officers and directors may, but are not obligated to, loan you funds as may be required, and if you complete your initial business combination, you would repay such loaned amounts, and up to $1,500,000 of such loans may be convertible into Private Placement Warrants of the post-business combination entity. Additionally, please revise the disclosure to discuss the key terms of any convertible securities and to disclose the potential impact of those securities on non-redeeming shareholders.
RESPONSE: In response to the Staff’s comment, a dilution analysis has been added on pages xii, 7 and 111 of Amendment No. 2, together with all assumptions made. The key terms of the various convertible securities have been described on page xi. As noted in response to Comment 1, there are no working capital loans outstanding that could convert into Private Placement Warrants nor are any such loans contemplated.
Michael Purcell Timothy Levenberg U.S. Securities & Exchange Commission
September 25, 2024
Page 3
5. Please revise to make clear here and throughout the filing that the Bogoso Preastea Mine has suspended operations and is an exploration stage property that will need to be restarted, and that this will require significant start up costs. Additionally, state that as of (the latest practicable date), the target company has generated no revenue. Please also provide an estimated timetable for when you believe you will begin operations, describe all material licenses and approvals required in order to restart operations, and state the status of each.
In response to the Staff’s comment, the Company respectfully advises the Staff that the disclosure has been revised throughout Amendment No. 2 to clarify that the Bogoso Prestea Mine has suspended operations and is an exploration stage property that will need to be restarted, and that this will require significant start-up costs. Additionally, the disclosure clarifies that BGHL has generated no revenue. It is the objective of BGHL to bring the mine back into production as soon as the necessary mechanical, engineering and metallurgical test work has been completed. BGHL intends to complete a further definitive feasibility study of the refractory project within 18 months. BGHL will endeavor to acquire the following material licenses and approvals by November 2024: Environmental Permit, Mine Operating Permit, Fire Certificate, Export Gold Permit, and Water Usage Permit.
Tax Laws Relating to Mining, page 14
6. Revise to clarify your references to the Obuasi TCA for AGA Ghana and to AGA Iduapriem. These entities do not appear to be listed elsewhere in the prospectus.
In response to the Staff’s comment, the Company respectfully advises the Staff that it has revised the disclosure on page 14 of Amendment No. 2 by removing references to Obuasi TCA for AGA Ghana and AGA Iduapriem as they are not applicable to Blue Gold.
Risk Factors
Regional Risk Factors
The Government of Ghana has the right to increase its interest in certain subsidiaries., page 28
7. Revise this factor and related disclosure elsewhere to clarify whether the “golden share” would provide Ghana with a pre-emptive right to purchase all gold and other minerals produced. Also clarify the material terms (including any pricing formula) pursuant to which Ghana would be entitled to make such purchases.
In response to the Staff’s comment, the Company respectfully advises the Staff that the disclosure on page 28 of Amendment No. 2 has been revised by removing such risk in its entirety. The government has a statutory pre-emptive right to purchase all gold produced, which right exists separately from the government’s right to acquire golden shares. The pre-emptive right is rarely used, however, the government has recently (and on the back of its gold for oil (G4O) initiative) directed all large-scale mining companies to sell 20% of all their refined gold to the Bank of Ghana (in Ghana Cedis) before any exports.1 No pricing formula is prescribed by statute in connection with the exercise of government’s pre-emption rights. In the example cited above, the gold was purchased at the spot price with no discounts.2 The Government of Ghana does not have the right to increase its equity stake in Blue Gold. Any increase would only be through bilateral agreement.
1 https://www.pmmc.gov.gh/directives-gold-4-oil-programme/. See also
https://eiti.org/sites/default/files/2023-01/2020%20GHEITI%20Mining%20Sector%20Reconciliation%20Report_compressed_0.pdf at page 94
2 Ibid
Michael Purcell Timothy Levenberg U.S. Securities & Exchange Commission
September 25, 2024
Page 4
Any downturn in Ghana’s economy may impact BGHL’s growth, profitability and ability to
continue BGHL’s operations., page 29
8. We note the discussion of historically high inflation, including the statement that “inflation dropped to 41% and the Cedi has been on an appreciating path against the USD in the second quarter.” Please provide updated disclosure, and explain the reference to being on “an appreciating path against the USD.” Also, identify actions planned or taken, if any, to mitigate inflationary pressures.
In response to the Staff’s comment, the Company respectfully advises the Staff that the disclosure on page 30 of Amendment No. 2 has been revised. The value of the Cedi relative to the USD improved during second quarter of 2023, but since then has continued to depreciate against the USD. As a result, the impact of any inflation in local costs has been offset by the depreciation in the value of the Cedi against the USD, given that the Company’s revenues will be in USD.
Company Risk Factors, page 47
9. We note your sponsor is a Cayman Islands limited liability company, and a non-U.S. person. Please also tell us whether anyone or any entity associated with or otherwised involved in the transaction, is, is controlled by, or has substantial ties with a non-U.S. person. Please include risk factor disclosure that addresses how this fact could impact your ability to complete your initial business combination. For instance, discuss the risk to investors that you may not be able to complete an initial business combination with a U.S. target company should the transaction be subject to review by a U.S. government entity, such as the Committee on Foreign Investment in the United States (CFIUS), or ultimately prohibited. Further, disclose that the time necessary for government review of the transaction or a decision to prohibit the transaction could prevent you from completing an initial business combination and require you to liquidate. Disclose the consequences of liquidation to investors, such as the losses of the investment opportunity in a target company, any price appreciation in the combined company, and the warrants, which would expire worthless.
RESPONSE: In response to the Staff’s comment, the disclosure has been revised to clarify that both the Managing Sponsor and the Former Sponsor are Delaware limited liability companies, not Cayman Islands limited liability company. The requested Risk Factor entitled “We may not be able to complete an initial business combination with a U.S. target company if such initial business combination is subject to U.S. foreign investment regulations and review by a U.S. government entity such as the Committee on Foreign Investment in the United States (CFIUS), or ultimately prohibited” has been added on page 49 of Amendment No. 2.
Michael Purcell Timothy Levenberg U.S. Securities & Exchange Commission
September 25, 2024
Page 5
10. It appears that underwriting fees remain constant and are not adjusted based on redemptions. Revise your disclosure to disclose the effective underwriting fee on a percentage basis for shares at each redemption level presented in your sensitivity analysis related to dilution.
RESPONSE: In response to the Staff’s comment, a table has been added on page xiii disclosing the effective underwriting fee on a percentage basis at reach redemption level presented.
11. Revise the risk factor “If we are deemed to be an investment company” to note that if you are found to be operating as an unregistered investment company, you may be required to change your operations, wind down your operations, or register as an investment company under the Investment Company Act. Also disclose the consequences to investors if you are required to wind down your operations as a result of this status.
RESPONSE: In response to the Staff’s comment, the referenced risk factor has been revised to include the specified disclosure on page 55 of Amendment No. 2.
12. We note your disclosure on page 125 that to finance transaction costs in connection with the initial business combination, your Sponsor or an affiliate of your Sponsor or certain of your officers and directors may loan you funds, and if you complete your initial business
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CORRESP
1
filename1.htm
Giovanni Caruso
Partner
345 Park Avenue
New York, NY 10154
Direct
Main
Fax
212.407.4866
212.407.4000
212.937.3943
gcaruso@loeb.com
Via
Edgar
September 25, 2024
Michael
Purcell
Timothy Levenberg
U.S. Securities & Exchange Commission
Division of Corporation Finance
Office of Energy and Transportation
100 F Street, NE
Washington, D.C. 20549
Re: Blue
Gold Ltd
Registration
Statement on Form F-4
Filed
June 14, 2024
Amendment
No. 1 to Registration Statement on Form F-4
Filed
July 5, 2024
File
No. 333-280195
Dear
Messrs. Purcell and Levenberg:
On
behalf of our client Blue Gold Ltd. (the “Company”), we are writing in response to your letter dated August 2, 2024 (the
“Staff’s Letter”) regarding the Company’s Registration Statement on Form F-4 (the “Registration Statement”)
and Amendment No. 1 to the Registration Statement on Form F-4 (“Amendment No. 1”). Concurrent herewith, we are filing Amendment
No. 2 to the Company’s Registration Statement reflecting the changes set forth below (“Amendment No. 2”) as
well as the requisite exhibits. For ease of reference, we have reproduced the comment below in bold with our responses following the
comments.
Registration
Statement on Form F-4
Questions
and Answers for Shareholders of Perception, page ix
1. We
note that certain shareholders agreed to waive their redemption rights. Please describe any
consideration provided in exchange for this agreement.
RESPONSE: In response to the
Staff’s comment, the Company respectfully advises the Staff that disclosure has been added on pages xiv, 70 and 130 to state that
no additional consideration was provided to those shareholders who agreed to waive their redemption rights.
Michael Purcell
Timothy Levenberg
U.S. Securities & Exchange Commission
September 25, 2024
Page 2
Summary
of the Proxy Statement/Prospectus, page 1
2. Please
provide organizational diagrams reflecting your corporate structure prior to and upon completion
of the proposed transactions.
In response to the Staff’s comment,
the Company respectfully advises the Staff that it has revised the disclosure on page 4 and 143 of Amendment No. 2 to provide the requested
organizational diagrams.
3. Please
quantify the aggregate dollar amount and describe the nature of what the sponsor and its
affiliates have at risk that depends on completion of a business combination. Include the
current value of securities held, loans extended, fees due, and out-of-pocket expenses for
which the sponsor and its affiliates are awaiting reimbursement. Provide similar disclosure
for the company’s officers and directors, if material. For example, we note the Sponsor
and Perception’s officers and directors (or their affiliates) have made loans to Perception
to fund certain capital requirements.
RESPONSE: In response to the
Staff’s comment, the Company respectfully advises the Staff that the aggregate dollar amount and nature of what the sponsor and
its affiliates have at risk has been disclosed on pages xxii, 10, 11, 94, and 95. Please note that while the Former Sponsor had made loans
for working capital purposes, in connection with the transfer of control to the Managing Sponsor in November 2023, the Former Sponsor
forgave all such loans. While the Company has incurred debt since that date, no loans have been made by the Managing Sponsor or any of
Perception’s officers, directors or affiliates that remain outstanding nor are any such loans contemplated.
4. Please
revise to disclose all possible sources and extent of dilution that shareholders who elect
not to redeem their shares may experience in connection with the business combination. Provide
disclosure of the impact of each significant source of dilution, including the amount of
equity held by founders, convertible securities, including warrants retained by redeeming
shareholders, at each of the redemption levels detailed in your sensitivity analysis, including
any needed assumptions. For example, we note your Sponsor or an affiliate of your Sponsor
or certain of your officers and directors may, but are not obligated to, loan you funds as
may be required, and if you complete your initial business combination, you would repay such
loaned amounts, and up to $1,500,000 of such loans may be convertible into Private Placement
Warrants of the post-business combination entity. Additionally, please revise the disclosure
to discuss the key terms of any convertible securities and to disclose the potential impact
of those securities on non-redeeming shareholders.
RESPONSE:
In response to the Staff’s comment, a dilution analysis has been added on pages xii, 7 and 111 of Amendment No. 2, together
with all assumptions made. The key terms of the various convertible securities have been described on page xi. As noted in response to
Comment 1, there are no working capital loans outstanding that could convert into Private Placement Warrants nor are any such loans contemplated.
Michael Purcell
Timothy Levenberg
U.S. Securities & Exchange Commission
September 25, 2024
Page 3
5. Please
revise to make clear here and throughout the filing that the Bogoso Preastea Mine has suspended
operations and is an exploration stage property that will need to be restarted, and that
this will require significant start up costs. Additionally, state that as of (the latest
practicable date), the target company has generated no revenue. Please also provide an estimated
timetable for when you believe you will begin operations, describe all material licenses
and approvals required in order to restart operations, and state the status of each.
In response to the Staff’s comment,
the Company respectfully advises the Staff that the disclosure has been revised throughout Amendment No. 2 to clarify that the Bogoso
Prestea Mine has suspended operations and is an exploration stage property that will need to be restarted, and that this will require
significant start-up costs. Additionally, the disclosure clarifies that BGHL has generated no revenue. It is the objective of BGHL to
bring the mine back into production as soon as the necessary mechanical, engineering and metallurgical test work has been completed. BGHL
intends to complete a further definitive feasibility study of the refractory project within 18 months. BGHL will endeavor to acquire the
following material licenses and approvals by November 2024: Environmental Permit, Mine Operating Permit, Fire Certificate, Export Gold
Permit, and Water Usage Permit.
Tax
Laws Relating to Mining, page 14
6. Revise
to clarify your references to the Obuasi TCA for AGA Ghana and to AGA Iduapriem. These entities
do not appear to be listed elsewhere in the prospectus.
In
response to the Staff’s comment, the Company respectfully advises the Staff that it has revised the disclosure on page 14 of Amendment
No. 2 by removing references to Obuasi TCA for AGA Ghana and AGA Iduapriem as they are not applicable to Blue Gold.
Risk
Factors
Regional
Risk Factors
The
Government of Ghana has the right to increase its interest in certain subsidiaries., page 28
7. Revise
this factor and related disclosure elsewhere to clarify whether the “golden share”
would provide Ghana with a pre-emptive right to purchase all gold and other minerals produced.
Also clarify the material terms (including any pricing formula) pursuant to which Ghana would
be entitled to make such purchases.
In
response to the Staff’s comment, the Company respectfully advises the Staff that the disclosure on page 28 of Amendment No. 2 has
been revised by removing such risk in its entirety. The government has a statutory pre-emptive right to purchase all gold produced, which
right exists separately from the government’s right to acquire golden shares. The pre-emptive right is rarely used, however, the
government has recently (and on the back of its gold for oil (G4O) initiative) directed all large-scale mining companies to sell 20%
of all their refined gold to the Bank of Ghana (in Ghana Cedis) before any exports.1
No pricing formula is prescribed by statute in connection with the exercise of government’s pre-emption rights. In the example
cited above, the gold was purchased at the spot price with no discounts.2 The Government
of Ghana does not have the right to increase its equity stake in Blue Gold. Any increase would only be through bilateral agreement.
1 https://www.pmmc.gov.gh/directives-gold-4-oil-programme/.
See also
https://eiti.org/sites/default/files/2023-01/2020%20GHEITI%20Mining%20Sector%20Reconciliation%20Report_compressed_0.pdf
at page 94
2 Ibid
Michael Purcell
Timothy Levenberg
U.S. Securities & Exchange Commission
September 25, 2024
Page 4
Any
downturn in Ghana’s economy may impact BGHL’s growth, profitability and ability to
continue
BGHL’s operations., page 29
8. We
note the discussion of historically high inflation, including the statement that “inflation
dropped to 41% and the Cedi has been on an appreciating path against the USD in the second
quarter.” Please provide updated disclosure, and explain the reference to being on “an
appreciating path against the USD.” Also, identify actions planned or taken, if any,
to mitigate inflationary pressures.
In response to the Staff’s comment,
the Company respectfully advises the Staff that the disclosure on page 30 of Amendment No. 2 has been revised. The value of the Cedi
relative to the USD improved during second quarter of 2023, but since then has continued to depreciate against the USD. As a result,
the impact of any inflation in local costs has been offset by the depreciation in the value of the Cedi against the USD, given that the
Company’s revenues will be in USD.
Company
Risk Factors, page 47
9. We
note your sponsor is a Cayman Islands limited liability company, and a non-U.S. person. Please
also tell us whether anyone or any entity associated with or otherwised involved in the transaction,
is, is controlled by, or has substantial ties with a non-U.S. person. Please include risk
factor disclosure that addresses how this fact could impact your ability to complete your
initial business combination. For instance, discuss the risk to investors that you may not
be able to complete an initial business combination with a U.S. target company should the
transaction be subject to review by a U.S. government entity, such as the Committee on Foreign
Investment in the United States (CFIUS), or ultimately prohibited. Further, disclose that
the time necessary for government review of the transaction or a decision to prohibit the
transaction could prevent you from completing an initial business combination and require
you to liquidate. Disclose the consequences of liquidation to investors, such as the losses
of the investment opportunity in a target company, any price appreciation in the combined
company, and the warrants, which would expire worthless.
RESPONSE: In response to the
Staff’s comment, the disclosure has been revised to clarify that both the Managing Sponsor and the Former Sponsor are Delaware
limited liability companies, not Cayman Islands limited liability company. The requested Risk Factor entitled “We may not be able
to complete an initial business combination with a U.S. target company if such initial business combination is subject to U.S. foreign
investment regulations and review by a U.S. government entity such as the Committee on Foreign Investment in the United States (CFIUS),
or ultimately prohibited” has been added on page 49 of Amendment No. 2.
Michael Purcell
Timothy Levenberg
U.S. Securities & Exchange Commission
September 25, 2024
Page 5
10. It
appears that underwriting fees remain constant and are not adjusted based on redemptions.
Revise your disclosure to disclose the effective underwriting fee on a percentage basis for
shares at each redemption level presented in your sensitivity analysis related to dilution.
RESPONSE:
In response to the Staff’s comment, a table has been added on page xiii disclosing the effective underwriting fee on a percentage
basis at reach redemption level presented.
11. Revise
the risk factor “If we are deemed to be an investment company” to note that if
you are found to be operating as an unregistered investment company, you may be required
to change your operations, wind down your operations, or register as an investment company
under the Investment Company Act. Also disclose the consequences to investors if you are
required to wind down your operations as a result of this status.
RESPONSE: In response to the
Staff’s comment, the referenced risk factor has been revised to include the specified disclosure on page 55 of Amendment No. 2.
12. We
note your disclosure on page 125 that to finance transaction costs in connection with the
initial business combination, your Sponsor or an affiliate of your Sponsor or certain of
your officers and directors may loan you funds, and if you complete your initial business