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Arafura in $11m rights issue for demerger proposal

Perth based mineral explorer Arafura Resources NL has today lodged a prospectus to raise almost $11 million via a non-renounceable rights issue.
Arafura CEO Alistair Stephens said the funds raised would be used for uranium exploration purposes and would be transferred into a new uranium exploration and investment company, NuPower Resources Ltd.
The rights issue is underwritten by Bell Potter Securities Limited and will not be made available to shareholders registered outside of Australia and New Zealand.
The issue price of the 30.5 million shares will be 36 cents each.
Earlier this year, Arafura announced a corporate restructure which would, subject to shareholder and regulatory approvals, result in the company's Northern Territory uranium assets being transferred to NuPower.
Under the proposed demerger, Arafura would retain its rare earths, gold and iron-ore assets (and the uranium content of Nolans Bore) and focus on developing the Nolans Bore rare earths project.
If the proposed demerger does not proceed then Arafura will use the funds to evaluate tenements prospective for uranium, working capital in Arafura and meet the costs of the proposed demerger to date.
Arafura will retain a 10 per cent holding in NuPower which is expected to be lsted early next year.
At market close, Arafura's share price was down over five per cent to 44.5 cents.

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Share Price

Closing price for the last 90 trading days
Source: Morningstar

Total Shareholder Return as at 29/06/18

1 year TSR5 year TSR
10thRedbank Copper1450%99%
80thPeel Mining150%8%
202ndArafura Resources57%2%
598thCapricorn Metals-19%28%
805thCradle Resources-70%-9%
722 WA (and selected non WA) listed companies ranked by 1 year TSR relative to other companies with similar revenue
Source: Morningstar

Share Transactions

02/11/17
$15k Bought
05/04/17
$5k Issued
05/04/17
$15k Issued
Total value as at the date of the transaction
Source: Morningstar

Revenue

127th↑Arafura Resources$847k
158th↑Cradle Resources$349k
159th↓Capricorn Metals$344k
164th↑Redbank Copper$329k
165th↑Peel Mining$319k
507 listed resources companies ranked by revenue.
Source: Morningstar

Remuneration from Arafura Resources

237thGavin Lockyer$456k
332ndPeter Sherrington$354k
383rdRichard Brescianini$313k
Ranked by total remuneration from all listed WA companies

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