West Perth-based Haranga Resources has lined up a $6 million share placement to support the continued development of its flagship Selenge iron ore project in Mongolia.
Haranga will issue 30 million new shares to a group of Mongolian investors at 20 cents per share for a total consideration of $6 million. The same investors will be also issued 15 million new options with a strike price of 20 cents for zero consideration on a “one for two” basis. The group will hold a combined 12.4 per cent of Haranga’s expanded share capital on an undiluted basis if shareholders approve the deal.
The investors are clients of Haranga’s corporate advisor Garrison Capital. Haranga chairman Matthew Wood is also executive chairman at Garrison Capital and holds significant interests in a number of ASX listed companies, including Mongolia-focused Voyager Resources.
The raising will take Haranga’s cash position to approximately $9.4 million. Managing director Robert Wrixon said the funds would enable Haranga to complete the process of obtaining a mining licence at Selenge and to complete a feasibility study on a full scale mine.
Shares in Haranga were up 1 cent to sit at 20 cents at 11:40AM WST today.