Kin updates $10.4m offer

Gold explorer Kin Mining says it has received commitments from a group of unnamed shareholders to underwrite $8 million of its planned $10.4 million entitlement offer.

The company said the shareholders, who collectively hold 26 per cent of Kin, had subscribed for their entitlements and agreed to underwrite a portion of the shortfall of the offer.

Under the agreement, no shareholder is capable of obtaining a stake of more than 19.99 per cent in the company.

Last month, a group of dissident shareholders led by former director David Sproule sought a board spill, including the removal of chief executive Andrew Munckton.

The shareholders have requested a meeting to consider a series of motions to remove all five directors and appoint three replacements, including Mr Sproule.

Kin said today the company was not obligated to place any shortfall with the underwriters.

“As is typical of many underwriting commitments, the underwriting agreements also contains a termination right in favour of the underwriters in the event of any change in the composition of the Kin board,” the company said in a statement to the ASX.

“The provisions of the underwriting agreements therefore ensure that, in the event of a change in the Kin board composition following the section 249D resolutions to be considered at the AGM, both the company and the underwriters have respective rights to elect to not proceed with the underwriting.”

The underwriters will be paid a 5 per cent underwriting fee on their respective components of shortfall placement underwriting.

Proceeds from the raising will be spent at the Leonora gold project , where it suspended construction in May after a review confirmed increases in the pre-production capital costs.

Share in Kin were flat at 7.6 cents each at 1pm AEDT.