15/08/2012 - 09:44

Elphinstone takes cornerstone stake in Venture

15/08/2012 - 09:44

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Elphinstone takes cornerstone stake in Venture
A Venture Minerals employee inspecting a core sample on site at Livingstone.

Venture Minerals has lined up $17 million in new capital to fund its Livingstone and Riley direct shipping iron ore projects in Tasmania to production, with magnate Dale Elphinstone’s private company emerging as a substantial shareholder.

Venture announced today it had launched a $15 million placement to new and existing investors, alongside a $2 million share purchase plan to be offered to all shareholders, with both the placement and the purchase plan priced at 31 cents per share.

Elphinstone Holdings has agreed to tip in $6 million to the placement to emerge as a cornestone investor, Venture said.

GMP Securities acted as sole lead manager and sole bookrunner to the placement.

The two companies also announced an agreement to determine how Elphinstone can assist Venture develop its Tasmanian assets, with Elphinstone to act as Venture’s preferred mining equipment and services provider.

As consideration for signing the project opportunity and development assistance agreement, Venture will issue Elphinstone 6.4 million options in three tranches, exercisable at 45 cents, 50 cents and 55 cents, respectively.

Venture managing director Hamish Halliday said the capital raising left the company fully funded through to targeted commencement of production from its DSO projects next year.

The Livingstone and Riley projects, located near the company’s flagship Mt Lindsay tin and tungsten project, have a combined DSO resource base of 4.4 million tonnes at 57 per cent Ferrous.

“The remainder of 2012 and 2013 will be an exciting time for Venture as we move toward production at the DSO iron ore projects and further progress the development of the Mt Lindsay project,” Mr Halliday said in a statement.

“The success of this raising and the introduction of Elphinstone as a substantial shareholder in Venture demonstrates the strong support for Venture’s emerging suite of projects.”

At 9:24AM, WST, Venture stocks were down 7 per cent, at 33 cents.

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