Companies seek for the financial contribution from the investors, which includes institutional investors, sophisticated investors, etc. Existing shareholders also can participate to this fund raise program, subject to the conditions. The key reason behind the fund raising is to support the overall growth of the company. Here, we are discussing few companies, which recently came up with their respective Capital Raising Plan.
Indiana Resources Limited (ASX: IDA)
Indiana Resources Limited (ASX: IDA) is involved in the exploration of minerals. The company on 26th June 2019 announced the successful completion of the first stage of the Equity Raising with a Single Tranche Placement (“Placement”). The company raised $300,000 (before costs) through the Placement, which introduced a number of new, high quality sophisticated and professional investors. The Placement was comprised of the issuance of 12.5 million fully paid ordinary shares at an issue price of $0.024, representing a 20% discount to the last closing price of $0.030 on 21st June 2019, and a 20% discount to the 15-day VWAP up to and including that date of $0.030.
The success of the Placement will lead Indiana to proceed with the next stage of the equity raising, a non-renounceable Entitlements Offer (“Entitlements Offer”) to existing shareholders to participate at the Placement price to further raise up to $1.3 million, which is before costs.
With the mentioned facilities, the company will raise up to $1.6 million (Equity Raising). The raised fund will be deployed to progress exploration activities across its highly prospective 363km strategic landholding in West Mali, including the drill testing of high priority geochemical anomalies and follow up of significant drill intercepts from the previous drilling. The raised funds will partially be deployed to advance discussions with the Tanzanian Government on resolving tenure issues at the Ntaka Hill nickel sulphide project and to support working capital.
JP Equity Partners has acted as a Lead Manager to the Placement and Entitlement Offer, whereas Discovery Capital Partners was appointed as a Corporate Advisor to the Placement and Entitlement Offer.
Indicative Timetable - Key dates for the Equity Raising are as follows:
As at 31st March 2019, the cash at bank stood at $0.38 million on the books. The company had 105,994,876 shares on issue and 6,898,057 unquoted options outstanding.
The company, in Western Mali, recently concluded the legal, financial and technical due diligence for the Saboussire License.
At the market price of $0.032, the market capitalisation of the company stands at $3.18 million on 26th June 2019. The stock has generated a return ~53% in the last one year.
Auctus Alternative Investments Limited (ASX: AVC)
Auctus Alternative Investments Limited (ASX: AVC) has synergistic technology assets portfolio with an emphasis on mobile businesses.
Capital Raise Program: The company recently updated the market that it has received binding commitments from a mix of current and new sophisticated and professional investors and raised ~$1.13 million (Placement). The issue price was set at $0.35 (35 cents) per share being 3.25 million new fully paid ordinary shares. AVC will issue 2.89 million shares utilising its capacity in accordance with ASX Listing Rule.
The raised funds through the Placement will be deployed for (a) Investment for initial working capital in RBP Partners, US Asset Management (2) Working capital for Auctus to continue its growth.
AVC has agreed upon to convert its present convertible notes (face value of $130,000) at the Placement price in consideration of the noteholder coming to an agreement to surrender the future rights to be redeemed on the notes on its expiration.
AUM (Assets under management) and advice in Auctus Asset Management performed well in the March quarter, increasing to ~$16 million at the end of March 2019. At the end of the quarter, the company had ~$250k in cash.
At the market price of $0.320, the market cap of the company stands at $9.28 million.
Superior Lake Resources Limited (ASX: SUP)
Superior Lake Resources Limited (ASX: SUP) has an engagement in the exploration of mineral prospects. The company’s centre of attention is on redeveloping the Superior Lake Zinc Project in Canada. The Project is a high-grade zinc deposit with a JORC (Joint Ore Reserves Committee) resource of 34 g/t Ag, 0.9% Cu, 0.38 g/t Au and 2.35 Mt at 17.7% Zn.
The company recently informed that it has continued to advance the permitting and approval process to redevelop the Superior Lake Project. For the purpose, SUP is engaged with indigenous rights holders, stakeholder groups and government agencies. Engagement activities will increase following the completion of a BFS (Bankable Feasibility Study), which remains on track for delivery during 3Q 2019. The BFS is a critical document, with various approvals to redevelop the project. SUP expects to start the construction of the project in 1H 2020, as by that time, all the approvals for the redevelopment will be in place.
The company in another announcement on 26th June 2019 advised that it has received subscriptions to purchase 216,363,122 fully paid ordinary shares at $0.0175 per share to raise $3.78 million (before costs) through a placement to professional and sophisticated investors (the ‘Placement’). The company also mentioned that Directors subscribed for 11,428,571 shares and issuance of which is pursuant to the shareholder approval at the next general meeting.
The Placement was made using a share issuance capacity of the company under ASX Listing Rules, with 129,817,873 shares issued under Listing Rule 7.1 and 75,116,678 shares issued under Listing Rule 7.1A. The Placement price was set at $0.0175 per share, representing a discount of 32.0% to the last trading price of $0.026 as on 21st June 2019, and a 23% discount to the 15-day VWAP. Placement shares are expected to be allotted on 2nd July 2019.
The company will use these funds from the Placement to further advance the Superior Lake Zinc Project. The process will also include finalising the project finance process, which is currently being managed by Orimco Pty Ltd. The funds will partially be deployed to secure the necessary permits and approvals for project development as well as advance high priority geophysical exploration targets with a drill program to take place later in the year.
At the market price of $0.019, the market cap of the company stands at $22.5 million on 26th June 2019. The stock has posted a negative return of ~19% in the last one year. The stock was down ~26.923% in today’s session, with day’s high and low at $0.019 and $0.018, respectively.
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