Proactive Investors - Run By Investors For Investors

Rainbow Rare Earths to issue equity as it receives conversion request from Lind

Rainbow Rare Earths' shares have by risen around 180% since mid-May as investors sought out opportunities with deposits outside China.
Rainbow Rare Earths project
Initially 26.9mln shares will be issued with an effective price of 2.69p.

Rainbow Rare Earths Ltd (LON:RBW) told investors that it has received an exercise notice from The Lind Partners LLC for the conversion of a US$900,000 loan facility.

It means that the company will be required to issue 26,290,251 new shares to Lind, giving an effective conversion price of 2.69p (versus Friday’s closing share price of 7.07p).

The company will however have to publish a prospectus in order to issue all the conversion shares. In the interim it is able to initially issue 8.44mln new shares to Lind.

READ: Rainbow Rare Earths secures new funding

A prospectus is expected to be ready by July, and the balance of 17.84mln shares will subsequently be issued.

Last month, the company secured a new funding agreement with its major shareholder, Pella Ventures.

Pella has given Rainbow an unsecured 12-month 15% loan of US$700,000 to support the rare earth element mining company’s development and operations.

The company said it expects to achieve cash-flow break-even in the second quarter of the next financial year, which runs to June 2020.

As market interest in non-Chinese sources of rare earths has risen substantially in recent weeks - amid Donald Trump’s escalating ‘trade war’ with China – the price of Rainbow Rare Earths shares have increased by around 180%, from 2.5p in mid-May to above 7p on Friday.

In Monday’s early deals Rainbow Rare Earths' shares were down 6.29% changing hands at 6.7p.

View full RBW profile View Profile

Rainbow Rare Earths Limited Timeline

Related Articles

May 31 2019
Chief executive Michael McNeilly said 2018 was a “transformational year” for the group w
ASX share price gain
November 28 2018
The company spoke to its strength at its AGM this week in Sydney.
Gold ingots
February 09 2019
The Brett gold property, which the company bought for $1.6 million in 2013, is a potential multi-million ounce system with multiple high grade targets.

© Proactive Investors 2019

Proactive Investors Australia PTY LTD ACN:132787654 ABN:19132787654.

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use