04/04/2014 - 14:57

Jacka launches review, $3.9m raising

04/04/2014 - 14:57

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Jacka Resources has launched a $3.9 million capital raising and will review its operations and restructure its board in a bid to cut costs following Tangiers Petroleum’s failed takeover of the company.

Jacka Resources managing director Bob Cassie and former Tangiers Petroleum executive director Eve Howell.

Jacka Resources has launched a $3.9 million capital raising and will review its operations and restructure its board in a bid to cut costs following Tangiers Petroleum’s failed takeover of the company.

The capital raising will include a $1 million share placement with the remainder of the funds to come from a one-for-eight non-renounceable entitlement issue to all shareholders.

Jacka said the proceeds from the raising would be used to repay existing debt of $1.7 million and for working capital purposes.

Patersons Securities and DJ Carmichael are joint-lead managers for the raisings, and Patersons will underwrite the entitlement offer.

Jacka said it would restructure its board over the coming weeks, reducing the number of directors to three.

Managing director Bob Cassie said the company had endured a challenging period during the failed takeover offer by Tangiers, and would review its operations.

“In light of recent events, the company has undertaken a review of its operation and has initiated numerous measures to cut costs and refocus the company on delivering value from its existing asset portfolio,” he said.

“Out of this review will emerge a new, smaller board structure and a comprehensive evaluation of its asset portfolio.”

Tangiers friendly takeover of Jacka fell through after the former’s executive chairman, Eve Howell, and non-executive director Max de Vietri – two staunch supporters of the deal – resigned following a loss of support from major shareholders.

Jacka said directors Stephen Brockhurst and Brett Smith would resign upon completion of the capital raisings and be replaced by two new directors, who are yet to be named.

Mr Brockhurst will assume the role of company secretary while Amanda Wilton-Heald takes extended leave.

Technical director Justyn Wood has also resigned, effective April 3.

Chairman Scott Spencer resigned from the company last month. Mr Cassie has been appointed to the position on an interim basis.

Jacka shares remain in a trading halt.

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