Gold and base metals producer, PNX Metals Limited (ASX: PNX) is progressing towards the development of its flagship Hayes Creek zinc-gold-silver project. Recently on 10 May 2019, the company closed its underwritten non-renounceable pro-rata rights issue which received acceptances for 371,111,697 new shares at an issue price of $0.006 per share for a total $2,226,670, representing an approximate 41% take-up.
The Rights Issue offer was announced on 18 April 2019 in which the company offered pro-rata non-renounceable three (3) for five (5) rights issue of up to approximately 913,233,012 New Shares at an issue price of $0.006 per New Share, to raise up to approximately $5.48 million.
Indicative timetable for the Rights Issue (Source: Company Reports)
A number of major shareholders participated in the Rights Issue, including DELPHI which took up its full entitlement together with the Board and management of the Company.
As per the underwriting agreement, DELPHI will be allocated the remaining shortfall of 539,073,425 shares for a total consideration of $3,234,441. After the completion of the Rights Issue, DELPHI’s shareholding in the Company will be around 40.6% on an undiluted basis.
The funds from the rights issue will be used to complete the Definitive Feasibility Study (DFS) at the company’s flagship Hayes Creek zinc-gold-silver project which will provide increased confidence in all aspects of the Hayes Creek as well as investigate opportunities to improve overall project economics which will increase the prospect of favourable development finance terms and structure. Besides this, the funds from the Rights issue will also be used for ongoing assessment of the high-grade Fountain Head gold project which is located less than 15km from the Hayes Creek Project.
As per the company’s announcement, the new shares under the Rights Issue will be issued on 20 May 2019 and holding statements is scheduled to be despatched on 21 May 2019.
The Hayes Creek Project is comprised of the Iron Blow and Mt Bonnie zinc-gold-silver deposit, located in a favourable mining jurisdiction with great infrastructure facilities like rail, road, high voltage power lines and water.
In 2019 June quarter, the company is planning to complete the updated mineral resource estimate for Mount Bonnie to include results of 2018 drilling. Further, the company will also commence the locked cycle flotation at Iron Blow to confirm design parameters and provide technical information for marketing and offtake.
Now, let’s have a glance at the company’s stock performance and the return it has posted over the past few months. The stock last traded at a price of $0.005, with a market capitalisation of ~$7.61 Million as on 15 May 2019. The stock has provided a year till date return of -21.43% & also posted returns of -31.25%, -8.33% & -21.43% over the past six months, three & one-month period respectively. It had a 52-week high price of $0.011 and touched 52 weeks low of $0.005, with an average volume of ~962,455.
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