13/08/2019 - 14:32

Capricorn to raise $65m

13/08/2019 - 14:32

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Capricorn Metals is set to raise $65 million via a share placement it says will underpin the development of its $132 million Karlawinda gold project.

Capricorn to raise $65m
Capricorn is now hoping to pour first gold at Karlawinda around the March 2021 quarter.

Capricorn Metals is set to raise $65 million via a share placement it says will underpin the development of its $132 million Karlawinda gold project.

Shares were issued at 16 cents per share, which represents a discount of 15.8 per cent to its last closing price of 19 cents on August 9.

Capricorn said the equity raising enabled it to satisfy a key condition to the finalisation a $107 million debt and gold hedging facility from Macquarie Bank for the development of Karlawinda.

The Macquarie package, which was announced in December, includes a $81 million senior project facility, a bank guarantee of $19 million, and a $7 million working capital facility.    

The facility was contingent on an undisclosed minimum equity contribution from Capricorn.

Capricorn today said it was now working with Macquarie to expedite securing the availability of the debt and gold hedging facility.

The company said the placement was cornerstoned by two of Capricorn’s current substantial shareholders – Paradice Investment Management and Hawke’s Point Holdings.

Furthermore, several of the founders of Equigold, three of whom were also previously been directors and shareholders of Regis Resources, subscribed for a total of $10 million.

Mark Clark and Mark Okeby, both formerly of Regis Resources, joined the board of Capricorn last month.

Mr Clark joined the Capricorn board as executive chairman, while Mr Okeby was appointed as a non-executive director.

Capricorn said the proceeds of the raising, which will bring its existing cash resources to around $90 million, would be utilised to accelerate the development of Karlawinda.

This included the completion of other pre-development and infrastructure activities, pre-production mining works and deposits for long lead capital items, and construction of processing plant and associated infrastructure.

Capricorn was originally targeting the start of production at Karlawinda in the June quarter of 2019, but was now hoping to pour first gold around the March 2021 quarter.

Construction of the project is now slated for the March 2020 quarter.

Karlawinda is located 70 kilometres by road south-east of the town of Newman.

Shares in Capricorn were up 13.2 per cent to trade at 22 cents each at 3.15pm AEST.

 

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