Blackham to raise $26m to help pay off debts

Blackham Resources has announced a fully underwritten renounceable entitlements issue to raise $25.8 million, of which $10 million will be used to pay debts owing to contractor MACA and The Lind Partners.

Under the offer, Blackham will issue five shares for every four shares held, at a price of 1.5 cents, which is a 44.4 per cent discount to its previous closing price of 2.7 cents each.

It will also issue one free attaching option for every three of the entitlement shares issued, with each option being exercisable at 3 cents each at an expiry date of October 12 2020.

MACA has agreed to sub-underwrite up to $7.5 million of the entitlements issue, with MACA’s participation to be applied to a reduction of the trade receivable balance owing to MACA.

The Lind Partners has agreed to sub-underwrite up to $2.5 million, with equivalent conditions applying.

Blackham’s executive chairman Milan Jerkovic has committed to personally sub-underwrite $1 million and to also subscribe for a $160,000 entitlement.

A substantial portion of the remainder of the capital will help fund an expansion at its Matilda-Wiluna operation, allowing the mine’s production to rise from 100,000 ounces to 120,000oz of gold a year.

Hartleys and Morgans Financial were appointed joint lead managers for the entitlements issue, with Hartleys being the arranger of the underwriting.

Shares in Blackham were down 33.3 per cent to trade at 1.8 cents each at 1.45pm AEDT.