Vimy raises $17m

Vimy Resources has completed a deeply discounted capital raising to fund work on its two uranium projects, one week after a strategic review failed to unearth a new partner.

The company will issue 100 million shares at 17 cents per share.

That is a 24.4 per cent discount to the last closing price on 3 March and an 11.3 per cent discount to the 15-day volume weighted average price.

Today’s announcement comes after reports last week that Vimy was looking to raise $20 million.

Its plans were disrupted by extreme volatility in the global uranium market after the war in Ukraine resulted in a fire at a major nuclear plant.

Vimy will use the new money to fund completion of a bankable feasibility study, including mining studies and base metal recovery test work, at its Mulga Rock project in WA.

It will also advance pre-development site works at Mulga Rock, including developing water infrastructure, a communications tower and a main camp.

The company needs to undertake works in order to retain its ministerial approval.

Despite this, Vimy and other uranium companies are unlikely to gain approvals needed to export uranium in the foreseeable future, given WA Labor’s opposition.

Vimy also plans to commence a drilling program at the Alligator River project in the Northern Territory, focused on resource definition.

“The past few days have been exceptionally volatile for the global uranium sector, given the events on Friday in Ukraine,” managing director Steven Michael said.

“The strategic value of uranium deposits in Tier 1 jurisdictions has never been more apparent and there are few near term development opportunities that meet those criteria.

“Vimy’s major shareholders and new institutional investors recognise the growing strategic value of both the Mulga Rock and Alligator River projects in Australia and Vimy’s development plans.”

The company said the $17 million would make it fully funded into 2023.

Vimy announced last week it had evaluated multiple options as part of its strategic review, including joint venture development of Mulga Rocks and the sale of Alligator River.

However it did not close a deal on either option.