He said: “Black Rock is undertaking a pro-rata non-renounceable entitlement issue to eligible shareholders of ordinary fully paid shares in the company on the basis of one new share for every 16 shares held at the record date on June 9, 2020, at an issue price of 4.2 cents per share to raise up to around A$1.65 million.
“Subscribers to the offer will also receive one free option for every one new share subscribed for and issued, exercisable at 8.4 cents per option on or before the date which is three years from the date of issue.”
The entitlement offer is available to all Black Rock shareholders registered on the record date whose registered address is in Australia (or subject to certain restrictions described in Section 4.9 of the prospectus), New Zealand, Singapore and Hong Kong.
“Funding project development”
Funding from the offer will be used to progress development of the company’s Mahenge Graphite Project in Tanzania.
de Vries said: “The process of project development, by definition, requires ongoing investment to advance progress.
“With the majority of our major study work now completed, the funds raised from this offer will be used to progress our relationship with POSCO and completion of the process to resolve the structure and nature of the free carried interest attributable to the Government of Tanzania.
“I, therefore, encourage all shareholders to consider this offer and I would like to thank you for your continued support.”
In the letter, de Vries stated: "The funds raised by the capital raising provide the company with short-term certainty and security to progress the next steps of its growth plan and specifically to further develop the POSCO alliance and working on the structure and nature of the free carried interest attributable to the Government of Tanzania."
Over the last 12 months, Black Rock has delivered on several milestones at Mahenge, including:
- Delivery of the enhanced definitive feasibility study which increased project net present value to US$1.16 billion, with an AISC margin of 63.1%;
- Spherical purified graphite (SPG) production trial which delivered industry-leading yields;
- Development of an engineering procurement and construction (EPC) framework agreement with one of the largest construction companies globally, China Railway Group;
- Opening of village offices and ongoing corporate social responsibility (CSR) activities;
- Formal advice from the Government of Tanzania of intention to resolve structure and nature of free carried interest
- Completion of resettlement action plan field activities;
- Signing of strategic alliance and development MOU with POSCO; and
- Tanzanian investment bank to commence due diligence on Mahenge.