Just days after striking a deal with major shareholder Mark Creasy to acquire a gold tenement in the north-eastern Goldfields, Sirius Resources has completed an $11 million share placement.
Just days after striking a deal with major shareholder Mark Creasy to acquire a gold tenement in the north-eastern Goldfields, Sirius Resources has completed an $11 million share placement.
Sirius said the placement was oversubscribed after the company issued shares at 1 cents per share to institutional and sophisticated investors.
Investors also received one free unlisted option for every two shares subscribed to.
RM Capital was the lead manager to the placement.
Ochre Management advised Sirius on the capital raising.
The capital raising is still subject to regulatory and shareholder approval.
Mr Creasy will receive $2.76 million worth of shares in Sirius for divesting the Tropicana tenements.
See company statement below:
Sirius Resources (ASX:SIR) is pleased to advise that it has completed the recently announced A$11 million share placement at $0.01 per share to institutional and sophisticated investors (on a pre-consolidation basis). The placement was strongly oversubscribed. Participants will also receive one free unlisted option for every two shares.
The proceeds of the raising, once all required regulatory and shareholder approvals have been received, will be used to underpin an aggressive drilling program at its new gold exploration project in the Tropicana belt being acquired by Sirius from its major shareholder , Mark Creasy (see ASX announcement of 21st October).
RM Capital was lead manager to the placement, while Sirius was also advised by Ochre Management.
The raising is subject to regulatory and shareholder approval at a general meeting to be held in mid-December and is also subject to shareholder approval of several related transactions. As previously announced, these include:
restructuring of the existing Fraser Range Base Metal Joint Venture (FRBMJV) to give Sirius 70% ownership of all mineral rights over all tenements (now including gold);
acquisition of a 70% interest in highly prospective tenements (Tenements) owned privately by Mark Creasy or vendor entities controlled by him (Creasy), which cover 120 strike kilometres and 2,300 km2 within the Tropicana belt of Western Australia - one of Australia's most significant emerging gold belts which hosts the 5Moz Tropicana gold deposit.
the payment of A$2.76 million to Creasy entirely in the form of 276 million Sirius shares at 1 cent per share (on a pre-consolidation basis) as reimbursement for past costs incurred on the Tenements.
in addition, the issue of 44 million ordinary shares (on a pre-consolidation basis) should Sirius define a JORC compliant Inferred Resource of 500,000oz gold or more on the Tenements within five years from the date of completion under the Acquisition Agreement. These shares will be subject to the same consolidation as all other securities;
approval for Mark Creasy to exercise the 600 million options to acquire Sirius shares that he recently purchased in a private transaction. Creasy's current shareholding in Sirius exceeds 20% and, as a consequence, these options cannot be exercised in compliance with the Corporations Act without first Sirius obtaining shareholder approval.
a 1 for 20 capital consolidation, applicable to all existing securities and new securities described in this announcement, to decrease the issued share capital from the current total of approximately 1.6 billion to approximately 150 million post-transaction, and the unlisted options to approximately 75 million post-transaction. All securities will be issued on a consolidated basis.
Full details of the various aspects of the transaction will be described in a Notice of Meeting due to be released prior to mid-November.
Sirius' Managing Director Mark Bennett said he was pleased with the strong level of investor support for the placement, which is a key element of the overall transaction.
"The proceeds of the placement will enable us to pursue aggressive exploration programs at our flagship gold project, ensuring that we will be adequately resourced to build on the work already undertaken by Mark Creasy and test the many exciting gold prospects within the tenement package.
"The placement was at a modest (9%) discount to market to minimise dilution for existing shareholders, while the attached 1 for 2 option package provides an incentive for new investors who believe in the potential of the new project to be a company maker" he said.
This transaction will position Sirius with 2,300 km2 of prime gold prospective ground with drill-ready targets in one of Australia's gold exploration hotspots, and will enable the Company to aggressively drill these and also its many other advanced gold, nickel, copper and zinc exploration targets.
