ZINC explorer Prairie Downs Metals Ltd has taken the highly unusual step of issuing a prospectus to raise $600. Not $600 thousand, certainly not $600 million dollars, just little old $600. Or at least that is the stated purpose of the prospectus. In a strange quirk of the Corporations Law, which only people like Prairie Downs chairman and experienced corporate lawyer Jeremy Shervington would fully understand, the real reason for the 12-page prospectus lies elsewhere. Prairie Downs negotiated a $2 million share placement with US company Sempra Metals last month. Subject to due diligence, Sempra has also agreed to an off-take and marketing agreement for Prairie Downs’ planned zinc project in the Pilbara and may possibly invest a further $6 million by way of convertible notes. While Sempra plans to be a long-term shareholder, it wants the right to offer the placement shares for sale “without the need for disclosure under Part 6D.2 of the Corporations Act”. That can only happen if Prairie Downs lodges a prospectus, which is exactly what the company has done to satisfy its newest substantial shareholder.
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