Malaysian investor backs Alcyone

South Perth-based Alcyone Resources has raised a further $4.9 million through a shortfall placement, bringing it closer to its $16 million target.

Alcyone set out to raise $16 million through a rights issue announced in May but managed to raise just $7.4 million, narrowly surpassing the minimum subscription level of $6 million.  

Alcyone said today that Malaysian listed investment holding company Notion VTec Berhad had agreed to subscribe for $4.87 million of the rights issue shortfall at $0.005 per share to acquire just under 20 per cent of Alcyone's outstanding shares.

This takes Alcyone's capital raising to $12.8 million, with Notion holding the option of providing a further $2.5 million which would convert to a further 10 per cent of Alcyone shares subject to approvals.

Notion has the right to nominate one director to the Alcyone board as a result of the transaction.

"Given current conditions in commodity and equity markets for junior mining companies, the success of this rights issue highlights the strong value proposition of the company as a low-cost high grade Australian silver producer," Alcyone chairman Paul D'Sylva said.

Mr D'Sylva said Alcyone was now in a strong position to reach nameplate production capacity at its Texas silver mine in Queensland.