Flinders seeks $14.5m

Emerging iron ore company Flinders Mines is looking to raise up to $14.52 million under a non-renounceable rights issue, with the funds primarily used to repay a loan from its major shareholder Todd Corporation.

West Perth-based Flinders had received a $7 million unsecured loan facility from PIO Mines – a subsidiary of New Zealand-based Todd Corporation – in September last year.

The loan repayment is due on April 30.

Flinders says remaining funds will also pay fees associated with the BBI Group transaction, recently approved by shareholders, and to provide working capital.

The company will issue approximately 580.8 million shares under a one-for-six rights issue.

The offer is not underwritten.

Todd Corporation, which currently has a 56 per cent stake in Flinders, could increase its control in the company, should it take up its rights and minority Flinders shareholders don't.

Todd also holds a 90 per cent stake in BBI Group.

The offer comes nearly one month after Flinders shareholders gave their formal approval for the company to progress its Pilbara iron ore project, which involves entering into a joint venture with BBI.

Sixty-seven per cent of shareholders voted in favour of the deal at Flinders’ EGM, held on March 3.

Flinders shares were down 3.2 per cent at 1:00pm AEDT to 30 cents per share.