Jindalee Resources Ltd (ASX:JRL) has received firm commitments from sophisticated and professional investors to raise $1.23 million as part of a $1.85 million capital raising to primarily accelerate exploration and development at McDermitt Lithium Project in the US.
Along with the placement at A$0.32 per share, the company has launched a non-underwritten 1 for 20 pro-rata non renounceable entitlement offer at the same price to raise up to a further $620,000.
The capital raising is at a 26.9% discount to the company's 5-day VWAP of A$0.44.
“Unique value proposition”
Chairman Justin Mannolini said: “We are pleased to be able to offer our shareholders the ability to participate in this capital raising, which will enable the company to accelerate exploration and development at our McDermitt lithium project as well as providing flexibility for our activities in Australia.
“The board believes that investors are beginning to awaken to the potential of sediment-hosted deposits to make a meaningful contribution to the global lithium supply chain in years to come.
“The strategic location of McDermitt, in a United States desperate for greater minerals self-sufficiency, provides Jindalee with a very unique value proposition relative to its ASX-listed peers.”
The placement will be conducted under Jindalee’s ASX Listing Rule 7.1 capacity and is anticipated to settle after the record date of the entitlement offer, such that placement participants will not be entitled to participate in the entitlement offer in respect of their placement shares.
No underwriting or similar fees are payable with respect to the placement.
The entitlement offer will be conducted on the basis of one new fully paid ordinary share for every 20 shares held by eligible shareholders at 5.00pm WST on Thursday, September 17 with shares offered at A$0.32 per share, the same price as the placement.
Shares issued under the entitlement offer will rank equally with existing shares.
Use of funds
Funds raised under the capital raising are intended to be applied as follows:
- Metallurgical test-work on the McDermitt Project;
- Drilling and resource estimation at the McDermitt Project (subject to timely receipt of drilling approvals);
- Widgiemooltha exploration activities to investigate gold and nickel potential; and
- General working capital requirements, costs related to the capital raising and contingent corporate purposes.