Black Canyon (ASX: BCA) advances with AU$0.85M placement for manganese projects

Highlights

• A placement of AU$0.85 million has been completed with support from institutional and sophisticated investors.
• The funds raised will be used to undertake development studies and exploration across the company's manganese assets.
• Directors intend to participate in the placement by subscribing for AU$100,000, subject to shareholder approval at a general meeting.
• A Share Purchase Plan (SPP) will be announced to raise AU$0.5 million.

Black Canyon Limited (ASX:BCA) is conducting a two-tranche placement to raise AU$0.85 million through the issue of nearly 12.1 million shares at AU$0.07 per share. The placement has garnered support from Australian Resource Investment Funds and existing sophisticated investors.

The proceeds from this capital raise will primarily fund development studies and exploration activities across the company’s manganese portfolio. This will include optimising the manganese concentrate flowsheet through metallurgical studies, conducting related feasibility assessments and drilling the high-grade Wandanya manganese target.

Additionally, funds will be allocated to advance the High Purity Manganese Sulphate (HPMSM) strategy, which involves further hydrometallurgical testwork and location assessments.

Details of the AU$0.85M placement

The placement involves an offering of 12.14 million shares and 6.07 million options. The issue price of AU$0.07 represents a discount of 15.4% to the 5-day VWAP and 19.6% to the 30-day VWAP, prior to the trading halt announced on 25 July 2024.

The first tranche of the placement comprises 5.4 million shares, with the second tranche consisting of 1.43 million shares along with the attaching options.

BCA directors have committed to participate in the placement, subscribing for AU$100,000 worth of shares. The participation of directors and the issuance of attaching options, both depends upon shareholder approval.

Participants in the placement will get one attaching option for every two shares subscribed. These options have a strike price of AU$0.14 and a term of two years.

Share purchase plan of AU$0.5M

In addition to the placement, the company plans to announce an AU$0.5 million SPP for its existing eligible shareholders who held shares on 26 July 2024. The SPP will offer terms similar to the placement, allowing shareholders to increase their holdings by up to AU$30,000 without incurring transaction or brokerage costs.

BCA shares traded at AU$0.080 apiece on 24 July 2024.