The placement price was at a discount of 12.5% to the last sale price and 17.5% to the 10-day volume weighted average price.
Funds will enable construction-related workstreams to progress quickly once a definitive feasibility study (DFS) for its Fort Cady Borate Project in Southern California is complete.
The study is due in October 2018 and the company believes this will be a transformational event as it evolves to the development stage.
“Borate market growing at 6% per annum”
American Pacific managing director and CEO Michael Schlumpberger said the placement would ensure the company could quickly move the Fort Cady project from studies to construction-ready activities following completion of the DFS.
He said: “We have a very unique project that combines low capex, high margin, low technical risk and an EBITDA profile of more than US$150 million per annum in full production into a borate market growing at 6% per annum, with limited visible supply.
“With borates non-substitutable in new world applications like electric vehicles, wind turbines, space shuttles and agriculture, we can only see our project becoming more valuable as the reality of a tight ongoing market with one dominant supplier continues.”
American Pacific management has committed an additional $200,000 worth of shares at the placement price subject to shareholder approval.
Following completion of the placement, the company will have more than $6 million cash on hand with no debt.
Fort Cady is the largest known contained borate mineral resource estimate in the world not owned by major borate producers Rio Tinto (ASX:RIO) and Eti Maden.