Technology Metals Australia Ltd (ASX:TMT) (FRA:TN6) has received commitments to raise $8 million through a placement of shares at $0.35 per share and has launched a share purchase plan (SPP) to raise up to $2 million on the same terms.
The placement was well supported by new and existing strategic and sophisticated investors.
TMT is pleased with the continued support of domestic and international investors, including a further investment by Mr Xu Jinfu, the chairman and major shareholder of Guangzhou Tinci Materials Technology Co Ltd.
Funds raised will be primarily used to advance the development of the Yarrabubba Iron-Vanadium Project.
The company envisages the capital raised will fund the completion of the Yarrabubba feasibility study.
“Pleased to have received strong support”
Technology Metals managing director Ian Prentice said: “We are very pleased to have received such strong support from both our existing strategic and sophisticated shareholders as well as the introduction of new shareholders to the register.
“The strength of this capital raising is a very strong endorsement of the company’s strategy in regard to the progression of Yarrabubba and the management team is very excited about executing the planned workstream to deliver on the potential of this project.”
The company will issue 22.85 million new fully paid ordinary shares to eligible sophisticated and institutional investors at $0.35 per share.
This is a 10% discount to the 15-day VWAP of TMT shares as at November 20, 2020, and a 17.7% discount to the last closing price prior to the placement.
Placement shares are intended to be issued under the company’s capacity pursuant to ASX Listing Rule 7.1 and 7.1A.
Bridge Street Capital Partners Pty Ltd and Cumulus Wealth Pty Limited acted as joint lead managers of the placement.
Use of funds
Proceeds will be primarily used to fund activities and development at the company’s rapidly emerging Yarrabubba Project, a satellite project to the globally significant Gabanintha Vanadium Project.
Test-work at Yarrabubba has confirmed the opportunity to produce a high-grade, high-purity iron-vanadium concentrate, with a weighted average grade of 64.3% iron and 1.71% Vanadium pentoxide.
Workstreams in support of the development of Yarrabubba include:
- Diamond drilling to generate bulk sample for pilot scale test-work, geotechnical data and resource infill /extension;
- Evaluation of logistics options, haulage routes;
- Resource infill and extension reverse circulation (RC) drilling designed to convert inferred resources to the indicated category and expand the overall resources;
- Pilot-scale test-work to confirm process flowsheet, generate samples for customer engagement and enabling refinement of engineering/process design work;
- Preparation of environmental submissions specific to Yarrabubba to enable the progression of mining approvals; and
- Targeting completion of study activities by late third quarter of 2021 to inform a development decision.
Share purchase plan
The company proposes to offer existing eligible shareholders the opportunity to participate in a non-underwritten share purchase plan (SPP) to raise up to $2 million.
Under the SPP, eligible shareholders with a registered address in Australia or New Zealand as of Thursday, November 26, 2020, will have the opportunity to apply for up to $30,000 of new shares at an offer price of $0.35 per share.
This equates to approximately a 19% discount to the 5-day VWAP of the company’s shares as traded on the ASX immediately prior to the announcement of the SPP.
The SPP offer period will open on Friday, November 27, 2020, and is expected to close on Friday, December 11, 2020.