VDM attracts new investor

Shares in VDM Group were up 125 per cent on news it had attracted a new cornerstone investor for an $18 million capital raising, highlighting the company’s planned shift from construction to mining. 

Under the terms of the deal, the unnamed sophisticated investor will be issued about 1.2 billion shares in the Dongyi Hua-led company at 1.5 cents each, equal to a 19.9 per cent stake in the business.

The offer price is a significant premium to VDM’s last closing price of 0.6 cents a share.

“The board considers the share placement agreement to be a positive outcome for all shareholders as the placement price is significantly above current trading prices, which reduces the share placement’s dilutive effect,” VDM said in a statement.

 “The funds raised will be used for VDM’s investment in the Cachoeiras do Binga copper exploration project located in the Republic of Angola, including acquisition of a 65 per cent participating interest in the project and subsequent site exploration and feasibility study work.”

VDM shares were 0.5 cents higher to 0.9 cents each at 10:30am.