Argonaut Resources to raise $4.1 million for uranium exploration in South Australia and NT

Junior explorer Argonaut Resources (ASX:ARE) is set to raise roughly $4.1 million through a placement and entitlement offer to progress exploration across its uranium tenements in South Australia and the Northern Territory.

Under the placement, the company will issue about 954.3 million new shares at $0.0005 per share to sophisticated and professional investors to raise $477,000. Argonaut is also seeking shareholder approval for a consolidation of its capital, resulting in one share held for every 100 pre-consolidation shares held.

Following this consolidation, Argonaut intends to complete a fully underwritten entitlement offer at the same price as the placement, and on a post-consolidation basis of $0.05 per share. This entitlement offer will be made on a 1 for 1 basis to raise about $3.65 million.

Argonaut will hold a general meeting on or around 7 August 2023 to seek approval for the consolidation, while a notice of meeting and associated documents are being prepared and will be distributed to shareholders in due course. The entitlement offer will launch as soon as practical after shareholder approval is received for the consolidation.

The funds raised will be directed towards uranium exploration, general working capital, and covering the costs of the offer

Following a board review of its exploration strategy and projects, Argonaut has elected to shift its strategic direction to focus principally on its Australian uranium assets. The funds raised will be directed towards uranium exploration, general working capital, and covering the costs of the offer.

Argonaut acquired its uranium exploration licences in South Australia and the Northern Territory through an unlisted public company, Orpheus Minerals, on 9 September 2021.

Under this transaction, the company secured the Frome and Cummins project in South Australia, along with the Mount Douglas, Ranger North-East, and T-Bone projects in the Northern Territory.

The company says securities under the placement are scheduled for allotment on 7 July 2023. Once allotted, these shares will rank equally with existing shares. Argonaut also reports it is continuing work to secure a replacement Managing Director to replace Lindsay Owler, who resigned on 2 May 2023.

Argonaut Resources is an ASX-listed mineral explorer focused on developing its copper and zinc projects in South Australia, Queensland, and Zambia, along with its uranium projects in South Australia and the Northern Territory.

The company had $858,000 cash at hand on 31 March 2023, according to its latest quarterly report published on 27 April 2023.

Write to Harry Mulholland at Mining.com.au

Images: Argonaut Resources NL
Written By Harry Mulholland
Hailing from the Central Coast region of NSW, Harry is a passionate journalist with a background in print, radio and ESG news. When not bashing away on his keyboard, he can be found brewing a coffee or playing with his dog.