Red Hawk swoops in on shareholders to gather $6.3 million

Red Hawk Mining (ASX:RHK) has launched a $6.3 million non-renounceable entitlement offer to fund a Prefeasibility Study (PFS) for its Blacksmith Iron Ore Project in Western Australia. 

The $105.53 million market capitalisation company’s entitlement offer gives eligible shareholders the opportunity to subscribe for one new share for every 12 shares held as of 5pm AWST on Thursday (26 October 2023). 

New shares will be issued at $0.45 per share — a 28% discount to the company’s last closing price of $0.625 and a 30% discount to its 15-day volume-weighted average price (VWAP) of $0.64.

Red Hawk says through the entitlement offer, shareholders can continue their participation in the company’s growth as it works to complete the Blacksmith PFS. 

As part of the offer, Red Hawk’s 2 major shareholders have committed to take up their full entitlements, totalling $5.1 million (80.2% of the offer), conditional on there being no material adverse event at any time prior to subscription. 

The company has launched an unmarketable parcel buy-back in addition to the offer to assist unmarketable parcel holders to sell without paying any brokerage or handling fees. 

Shareholders who hold less than a marketable parcel of shares in Red Hawk, which is valued at $500, can sell their shares back to the company at the buy-back price, being the higher of the 20-day VWAP ending on the buy-back closing date and the offer price. 

The offer is expected to open on 31 October 2023 and close at 5pm AWST on 22 November 2023. 

Red Hawk is focused on developing its wholly owned Blacksmith Project in the Pilbara region of Western Australia. 

The project is located about 70km northwest of the town of Tom Price and is surrounded by many ‘major’ iron ore projects, as well as ‘significant’ associated road, rail, and power infrastructure. 

Red Hawk Mining had $6.087 million cash and cash equivalents at hand as of 30 June 2023, according to its latest quarterly report.

Write to Adam Drought at Mining.com.au

images: Red Hawk Mining
Author Image
Written By Adam Drought
Born and raised in the UK, Adam is a sports fanatic with an interest in Rugby League and UFC/MMA. When not training in Muay Thai and Brazilian Jiu Jitsu, Adam attends Griffith University where he is completing his final year of a Communication & Journalism degree.