Mineral sands junior Sheffield Resources is set to raise $30 million to potentially expand its nearly constructed Kimberly project and to assess a business opportunity in Brazil.
Mineral sands junior Sheffield Resources is set to raise $30 million to potentially expand its nearly constructed Kimberly project and to assess a business opportunity in Brazil.
The funds raised will be used towards assessing growth options for its joint-venture Kimberley mineral sands project, the opportunity to acquire a stake in the South Atlantic project in Brazil and for corporate activities.
Sheffield will raise $18 million through a placement of 36 million new fully paid ordinary shares.
The West Perth-based company will raise a further $12 million through one for fourteen pro rata non-renounceable entitlement offer of new shares.
Sheffield has executed a binding investment agreement with Rio Grande Mineração (RGM) to acquire a 20 per cent interest in the company, which owns the South Atlantic mineral sands project in Brazil.
Under the agreement, an initial US$2.5 million, with further stages payment totally US$12.5 million based on the completion of key milestones.
Construction of the company’s flagship $484 million Thunderbird mineral sands project in the Kimberly is 75 per cent completed and is expected to deliver products in 2024.
The funds raised will be used to assess the development of a second stage of the project and the exploration of additional zones of mineralisation along the Dampier Peninsula.
“With Thunderbird Stage one over 75 per cent complete, on time for first customer delivery in Q1 2024, and with the expected cost to complete fully funded from existing KMS debt and equity, Sheffield is pleased make the next step in its strategy to assemble a portfolio of mineral sands developing and producing assets,” executive chair Bruce Griffin said.
“Over recent months, following the Thunderbird mineral sands project final investment decision, we initiated a review of potential business development opportunities to diversify our asset portfolio, and we believe the South Atlantic mineral sands project in Brazil presents a significant opportunity to increase Sheffield shareholder value.
“This equity raising allows Sheffield to maintain a sound financial position as we progress our new mineral sands business opportunity in Brazil and support future growth at Kimberley Mineral Sands”.
On the market, Sheffield Resources shares were down 12.61 per cent to 52 cents at 4.10PM AEDT.
