Lindian Resources (ASX:LIN) confirms that it has received binding commitments from new and existing sophisticated investors to subscribe for about 76.19 million fully paid ordinary to raise $16 million in a placement.
Sydney based Evolution Capital acted as manager to the placement.
The shares issues under the placement are priced at $0.21 per share, the company reports.
Lindian says it the new institutional shareholders to its register recognise the potential of the company’s globally significant Kangankunde Rare Earths Project in Malawi where extensive mine development drilling is ongoing.
Executive Chairman Asimwe Kabunga has subscribed for $575,000 in the $16 million placement under the same terms and conditions that will be subject to shareholder approval.
Under the placement, more than 73.452 million shares and more than 36.726 million options exercisable at $0.30 each, expiring three years from the date of issue, on the basis of 1 option being issued for every 2 shares subscribed for, are to be issued within the next 5 days.
Further shares and options are to be issued to the Executive Chairman and will be subject to shareholder approval obtained at a General Meeting of Shareholders at a time and date to be determined.
Addressing the capital raise, Chief Executive Officer Alistair Stephens says: “Lindian has made excellent progress in Malawi with the government, the community and with mine development drilling that is progressing as planned.
“This funding allows us to comfortably accelerate drilling which will now continue through the wet season using two tracked mounted rigs on site and two additional rigs available in areas not impacted by weather”
This funding allows us to comfortably accelerate drilling which will now continue through the wet season using two tracked mounted rigs on site and two additional rigs available in areas not impacted by weather. First assays are due later this month and they will be a pivotal point for the Company which we look forward to with much anticipation.”
Chairman Kabunga adds: “We are grateful to our new and existing investors for their support for this placement which was heavily bid. It reflects investors’ recognition that Kangankunde has all the hallmarks of a globally significant Rare Earths project of considerable scale and grade.”
The company reports the placement is a key milestone for Lindian as it facilitates the early payment of the next US$7.5 million tranche payment, due in late January 2023, to progressively acquire 100% of Rift Valley Resource Developments that holds 100% of the Kangankunde Rare Earths project.
The balance of funds raised are being used to accelerate the mine development drilling program at Kangankunde, for general working capital purposes, and the cost of the placement. The program is operating with three rigs with a fourth mobilising to site.
First assays are due in late December with a steady stream of assay results to be reported throughout early 2023.
Write to Adam Orlando at Mining.com.au
Images: iStock
