There will be 80.4 million shares issued at $0.50 per share and the company plans to use funds to fast-track the advancement of its major zinc-lead discovery at the Earaheedy Project in Western Australia.
These funds will provide the company with the resources to fully scope the major discovery, including a scaled-up diamond core and reverse circulation (RC) drilling program set to begin in the coming weeks.
The scaling-up will also include initial metallurgical test work and other studies.
The news was cheered by investors who pushed the company’s shares up by more than 28% to A$0.705 intra-day, a new record high.
Rumble Resources managing director Shane Sikora said: “The company is pleased to welcome new major institutional and well known significant sophisticated investors as Rumble shareholders.
“We see the strong support from the placement as vindication of the company’s pipeline of projects strategy, with a number of years of systematically advancing a number of exciting projects which led to the major discovery at the Earaheedy Project.
“The company looks forward to rapidly advancing the major discovery and advancing the company’s other projects, which also have Tier 1 potential.”
As a part of the placement, the company will issue shares in two tranches.
The first tranche of 78.4 million shares will be issued using the company’s existing capacity under ASX Listing Rule 7.1 and are anticipated to be allotted on Wednesday, May 5, 2021.
A second tranche of 2 million shares will be settled subject to shareholder approval at a shareholder meeting to be arranged shortly, as they are proposed to be issued to non-executive directors Matthew Banks and Michael Smith.
Ashanti Capital Pty Ltd and Bell Potter Securities Limited acted as joint lead managers to the placement.
Following the placement, the company will also be able to undertake work at its other projects, which have also been prioritised with the aim of defining further Tier 1 discoveries, as well as funding working capital.
The company acquired the project in October 2017 and since then has systematically advanced it culminating in the new major zinc-lead discovery.
Last week, the company released the initial assay results of an RC drilling program that confirmed the discovery at the Chinook Prospect.
The company believes Chinook has the potential to be at the upper end of the existing exploration target based on the consistent grades (4-5% zinc and lead).
Rumble’s zinc-lead exploration target at Earaheedy is between 40 to 100 million tonnes at a grade ranging between 3.5% to 4.5% zinc-lead.
The exploration target is at a relatively shallow depth (50-150 metres), and over 40 kilometres of prospective strike (completely open) has been defined within the Earaheedy Project.