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South Harz Potash Ltd (ASX:SHP) has successfully completed its pro-rata non-renounceable entitlement issue, in conjunction with a recent placement, raising approximately $1.57 million aimed at advancing the Ohmgebirge Potash Development project located in Germany.
This capital raise aligns with the company’s strategic focus on a streamlined, low-cost optimization approach while addressing current conditions in the global potash market. Key operational activities highlighted by South Harz include the completion of detailed due diligence and negotiations for the acquisition of the neighboring Sollstedt mine property from Deusa International GmbH. This acquisition is seen as a crucial step in bolstering the company’s resource base and operational capabilities.
Additionally, South Harz is making significant strides in the preparatory stage two permitting activities for the Ohmgebirge Potash Development. This phase follows the grant of the spatial planning assessment, which is essential for moving forward with development. Efforts are also underway to assess qualifications for potential German research and development tax incentive rebates. This includes exploring complementary funding opportunities, such as access to freight rail and grants related to clean energy and critical minerals, which could provide further financial support for the project.
Furthermore, the company is engaged in evaluating long-term pathways for definitive feasibility study design and development funding. This includes potential strategic partnerships that could enhance the project's viability and sustainability.
The entitlement issue allowed shareholders to acquire one additional share for every three shares held as of August 15, 2024, at a set issue price. While the entitlement offer aimed to raise up to approximately $2.97 million, the company reported that acceptances totalled around $541,096, with significant participation from key executives. Non-executive director Rory Luff subscribed for a notable number of shares, while executive chair Len Jubber also contributed.
Out of the total shares offered under the entitlement offer, a total of 54,109,646 shares were applied for, resulting in a shortfall of 242,579,778 shares. The entitlement offer closed on September 16, 2024, with the allotment of the new shares scheduled for today.
This capital infusion positions South Harz Potash to continue its developmental efforts on the Ohmgebirge project, aiming to leverage its resource potential and strategic positioning in the potash market as it navigates through current economic landscapes.
