Northern Minerals has completed an oversubscribed share placement, with the funds going towards exploration at the company’s rare earths projects in WA and the Northern Territory.
Perth-based Northern Minerals has completed an oversubscribed share placement, with the funds going towards exploration at the company’s rare earths projects in Western Australia and the Northern Territory.
Northern Minerals owns two projects in WA, Browns Range and John Galt, and the Boulder Ridge project in Northern Territory’s Tanami region.
The business this morning announced it had entered into binding subscription agreements with institutional investors in Australia, the US and throughout Europe to raise $20 million.
The proceeds will go towards further exploration at Northern Minerals’ projects and carrying out a feasibility study for a full-scale beneficiation plant at Browns Range, as well as planning a full-scale mining operation to feed the plant.
Chief executive Mark Tory said the business’ work program for 2021 was focussed on fast-tracking its pathway to achieving commercial heavy rare earths production “in response to emerging demand for such a product”.
He said additional funds raised would provide Northern Minerals with added flexibility to both fast-track feasibility work on the beneficiation plant and ramp-up its resource exploration drilling programme, with the objective of increasing Brown Range’s mine life.
Northern Minerals will issue about 204 million shares in two tranches under the placement, managed by New York-based EAS Advisors.
The new shares are priced at 4.9 cents each and represent a 5.8 per cent discount to the business’ last closing price of 5.2 cents on February 11.
Investors will also receive one free attaching unlisted option for every two subscription shares, exercisable at 7.4 cents each and with a three-year expiry.
Northern Minerals said it could raise a further $15.1 million if all the options were exercised.
Shares in the business closed up 1.9 per cent to trade at 5.3 cents.