East Perth-based North Australian Diamonds Ltd will restrict its exploration activities after it reviewed its cash position ahead of legal proceedings brought on by a major shareholder.
Today the diamond explorer advised stakeholders that recent cash expenditure, including funds
raised from the recent placement by Ascot Securities Pty Ltd, were needed to provide security for the solicitors and other costs.
Late last month, shareholder Anglo Pacific Group PLC challenged the first allotment of shares from a $6 million, three-stage capital raising, claiming the price was too low.
The first tranche consisted of 90 million shares priced at 0.5 cents each, raising $750,000.
Capital raised was to fund ongoing work at North Australia's flagship Merlin diamond project in the Northern Territory.
North Australian said today that it is seeking an earlier trial date, which is currently scheduled for between 9 and 13 October.
The Company estimates that it should have sufficient funds until the end of September 2008," North Australian said.
"The Directors are reviewing all available options with the view to maintaining a strong and viable operation to ensure the development of its Merlin Project."
