Mineral Commodities raises $10.6m

Mining company Mineral Commodities has secured funds through a share placement and rights issue to continue exploration and complete plant upgrades in South Africa.

Mineral Commodities operates the Tormin mineral sands mine about 360 kilometres north of Cape Town, which produces zircon, ilmenite, rutile, magnetite, and garnet.

The Belmont-based business plans to use some of the $10.6 million raised to fund exploration activities at Tormin’s Western Strandline deposit, as well as the first lot of upgrades to the ore processing plant.

The company, which is currently facing legal action from former boss Mark Caruso, says it has received binding commitments to raise $3.2 million under the placement.

It will issue 22.85 million shares on Monday, followed by a one-for-nine fully underwritten rights issue to raise $7.4 million.

Both offers are priced at 14 cents per share and represent a 32 per cent discount to Mineral Commodities’ last closing price (on June 24).

The rights issue is underwritten by existing shareholders including chairman David Baker, corporate development officer Peter Fox, and Mineral Commodities’ largest shareholder, Au Mining.

The offer is scheduled to close on July 30.

Shares in Mineral Commodities were down 2.4 per cent at 12:40pm AEST to trade at 20 cents.