Toro Energy is raising $15 million to advance its Wiluna uranium project in WA, as well as pay back debt and fund exploration programs.
Toro Energy is raising $15 million to advance its Wiluna uranium project in Western Australia, as well as pay back debt and fund exploration programs.
Toro believes its Wiluna development, located 30 kilometres south of the town of Wiluna in the Goldfields, will become the state's first uranium mine.
In 2013, the company obtained state and federal environmental approvals to develop the project’s Centipede and Lake Way deposits and associated processing facility. Toro is seeking extensions of the approvals to include Wiluna’s Millipede and Lake Maitland deposits.
The Wiluna project’s regional resource contains about 80.5 pounds of uranium oxide, sufficient to run the planned Wiluna mine for more than 20 years, Toro says.
Chairman Richard Homsany said the company would emerge from the capital raising debt free and well-funded at a time when the uranium market was entering a new phase of growth.
“Toro decided to take proactive action to strengthen its balance sheet to maximise shareholder value,” Mr Homsany said on Friday.
“The company’s flagship Wiluna uranium project is one of WA’s only advanced uranium projects with environmental approval from the state and federal governments.”
The placement proceeds will also go towards exploration activities at Toro’s Dusty nickel project and Yandal gold and base metals project, both in WA.
Toro has also agreed to repay about $15.6 million owing to its largest shareholder, Sentient Executive, by issuing 291 million new shares (representing $6.7 million) to the company. The debt conversion will be subject to shareholder approval at an extraordinary general meeting, to be held in mid-July.
Toro intends to pay the balance of debt ($8.9 million) using cash proceeds from the placement.
It said the raise was supported by several high-quality institutional investors including Mega Uranium, Toro’s third-largest shareholder, which has subscribed for $1.5 million worth of shares.
About 652 million shares will be issued under the placement, priced at 2.3 cents each.
Canaccord Genuity is acting as lead manager and bookrunner to the offer.
Shares in Toro closed down 13.8 per cent on Friday to trade at 2.5 cents.