23/05/2022 - 15:11

Wiluna pursuing $84m

23/05/2022 - 15:11

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West Perth-based Wiluna Mining is offering shares at more than a 40 per cent discount to raise a minimum $50 million to bring its namesake gold project up to speed.

Wiluna pursuing $84m
Wiluna Mining is undertaking a non-renounceable entitlement issue. Photo: WIluna Mining Corporation

West Perth-based Wiluna Mining Corporation is offering shares at more than a 40 per cent discount to raise a minimum $50 million to bring its namesake gold project up to speed.

As previously reported by Business News, Wiluna Mining detailed its plan to raise capital earlier this month, with Perth corporate advisory firm Lazarus Corporate Finance as its broker.

Wiluna notified the ASX before market close this afternoon, confirming it was chasing at least $50 million and up to $84.5 million via a one-for-one non-renounceable entitlement issue, with shares on offer at 40 cents.

That represents a 29.2 per cent discount on its last closing price and a 46.3 per cent discount on its 30-day volume-weighted average price.

Shares will be exercisable at 60 cents and expire December 31 2024.

According to the Wiluna board, raising $50 million would mean the company can continue working towards its targeted full production rate of up to 120,000 ounces a year by the end of 2022 at the Wiluna mining operation in the Mid West.

The call for capital comes weeks after deciding to put the brakes on a planned expansion and flagging slower mining and drilling rates due to skilled labour shortages and COVID-related issues.

Wiluna is also seeking debt for equity swap for any shortfall with certain creditors including its underground contractor Byrnecut, which have agreed to convert $13.4 million into the shortfall offer.

Wiluna executive chair Milan Jerkovic said the company had run into a number of adverse factors that had made it necessary to raise funds.

“These have included ramp up delays caused by COVID-19, and skilled labour shortages, inflationary cost pressures, the war in the Ukraine, shipping delays of key equipment and delays to concentrate sales,” Mr Jerkovic said in a statement.

“The board of Wiluna believe that once we have raised the minimum amount of $50.0 million in this capital raising, the company can continue to progress towards its targeted full production run rate from the stage one concentrator of 110,000-120,000 oz per annum by end of CY2022.”

Wiluna shares have been in a voluntary suspension since Friday.

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