Zambezi Resources has announced a funding strategy involving a $4.47 million capital raising to progress its Kangaluwi copper project in Zambia.
The company is to offer shareholders two new ordinary Zambezi shares for every existing three shares held at a price of 0.4 cents per share.
Zambezi stocks were trading at 0.6 cents per share at 2:15 WST.
The capital raised would be applied towards working capital, debt servicing and a continued drilling program and further metallurgical test work.
The company has also negotiated a bridging facility with major shareholder LinQ Resources Fund.
LinQ and Zambezi agreed on a $10 million convertible note facility made of two tranches in July; the first tranche of $5 million has already been drawn down, while the second was reserved for completion of a feasibility study for the project.
However, Zambesi has been able to access $1.5 million over nine months to bridge the gap in required capital.
LinQ has indicated it intends to take up its full entitlement of new Zambezi shares under the rights issue.
If the rights issue rails to raise the intended capital Zambezi intends to place the shortfall.
