Danakali raises $12m for potash project

Aspiring potash producer Danakali has tapped investors for $12.3 million as it moves ahead with development of its Colluli project in Africa.

Perth-based Danakali raised the funds through the placement of 20 million shares to UK and Australian investors at 62 cents a share, representing a 7.9 per cent discount to the company’s 30-day volume-weighted average price.

The proceeds of the raising will be used to complete development cost reduction and optimisation work in the front-end engineering process of the Colluli development works, as well as completion of tendering processes for key contracts.

“This placement is testimony of how the international profile of the Colluli project is growing and is a clear endorsement of the project, the jurisdiction and the company,” managing director Paul Donaldson said.

“The project is by all accounts world class and is the most advanced stage greenfield sulphate of potash development project globally.

“We are very pleased with the placement and specifically with the addition of more UK-based institutional investors to our share register.”

Hannam and Partners and Arlington Group Asset Management acted as joint lead managers to the raising, with financial advisory firm Baillieu Holst supporting the placement.

Danakali shares were 1.4 per cent higher to 68 cents each at 10:30am.