Arafura Resources’ rights issue has only raised only around a third of its $23.2 million target, with underwriter Patersons Securities set to be issued with $7.9 million worth of shares.
The rare earths hopeful said it raised $8.1 million from the seven-for-20 rights issue which it announced last month as a “transformational equity raising”.
Shares were issued at 8.5 cents per share, which represented a 32 per cent discount to its closing price of 12.5 cents before the announcement of the offer.
Patersons Securities was appointed as lead manager and underwriter to the offer, with rare earths project developer Talaxis sub-underwriting $7.2 million.
Perth-based Arafura said the funds would go towards the development of its flagship Nolans rare earths project in the Northern Territory.
This included commencement of front end engineering design work and early works construction contracts
A definitive feasibility study on the project was completed in February.
Arafura managing director Gavin Lockyer thanked the shareholders who participated in the offer.
“We are also very pleased with the support of Patersons Securities as lead manager and underwriter and the significant support from Talaxis limited as a strategic sub- underwriter, this backing has provided certainty and leadership for this capital raise,” Mr Lockyer said.
Shares in Arafura closed down 7.1 per cent at 9.2 cents each.