- Mineral explorer iTech Minerals is planning to raise up to AU$7 million via IPO.
- The company seeks to issue 25 million to 35 million shares.
- The issue price of the offer is AU$0.20 per share.
- The company owns interest in projects located in South Australia.
- iTech has signed a pact with Archer Materials to buy its assets.
The Australian initial public offering (IPO) market has witnessed a recent surge in public offerings by mineral exploration companies as miners are rushing in to cash in on higher metal prices. One such company is iTech Minerals, which has joined the IPO league to raise up to AU$7 million. The shares are expected be begin trading on the Australian Stock Exchange (ASX) on October 25, under the ticker name ‘ITM’.
The Aussie company seeks to raise a minimum of AU$5 million with oversubscriptions of up to AU$2 million by issuing 25 million shares to a maximum of 35 million shares at an offer price of AU$0.20 apiece. The public offer opened for subscription on September 1 and is expected to close on October 6. Following the closure of the offer, the company will allot shares to eligible applicants on October 15.
Here are the 10 key things you need to know before investing in iTech Minerals IPO:
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- Formed in February this year, the newly established entity targets the acquisition, exploration and development of all the mineral exploration assets currently owned by materials technology firm Archer Minerals (ASX:AXE).
- The Adelaide-based company holds interest in two halloysite-kaolinite projects, Eyre Peninsula Project and the Franklyn Project, located in South Australia.
- The company signed a pact with Archer Materials in April to buy its remaining mineral tenements, including two kaolin-halloysite mineral prospects and battery mineral projects. Archer is disposing of these assets due to a change of its focus from minerals exploration to advanced technology.
- Following the completion of the offers, these assets will become wholly owned subsidiaries of iTech Minerals. As per the share sale deal, the company will issue 50 million shares to Archer. The shares will be allotted on a pro rata basis to eligible Archer shareholders, which are around 8,000 in number.
- The company intends to use the IPO proceeds to fund the exploration and potential advancement of the projects. A part of the fund will be used for the exploration/drilling programs and feasibility studies of the projects across the company’s tenements.
- In May 2021, iTech raised pre-IPO seed funding of AU$705,000 by issuing 5 million founder shares at AU$0.001 per share and 5.83 million fully paid ordinary shares at AU$0.12 per share.
- The company does not intend to pay dividend in the first two years, citing expenditure on the evaluation and development of the projects.
- The minimum subscription for the offer is AU$5 million or 25 million shares, while the oversubscription limit is AU$7 million or 35 million shares.
- Post-IPO, the company will be an industrial and battery minerals exploration and development company with focus on developing two halloysite-kaolinite projects – Eyre Peninsula and Franklyn Project – as well as the Campoona Graphite Project in South Australia. The company’s aim is to discover and increase the available resources and to advance the projects toward commercial production of kaolin and graphite.
- Going forward, the company aims to become a valuable kaolin and battery minerals company.
Resource companies are making a beeline to list their shares on the ASX to capitalise on higher metal prices. The demand for battery metals such as graphite, rare earths, copper, cobalt, nickel and lithium, has been growing strongly due to rising global demand for electric vehicles and battery power. Next week, four resource companies – Mitre Mining, Star Minerals, West Cobar Metals and Besra Gold – are slated to get listed on the ASX.