Why Renascor Resources’ (ASX:RNU) shares fell nearly 9% today

December 08, 2022 12:52 PM AEDT | By Ashish

Why Renascor Resources’ (ASX:RNU) shares fell nearly 9% today — Image source: © Gibsonff | Megapixl.com

Highlights

On Wednesday, Renascor’s shares were placed on a trading halt.

The company raised nearly AU$70 million from institutional investors at a 14% discount of 27.5 cents per share.

Shares of Renascor Resources (ASX:RNU) were trading in the red on Thursday morning, a day after being placed on a trading halt so the company could undertake a fully underwritten institutional placement. The shares were trading at AU$0.29, down 8.75%, or 0.028 points, from the previous close of AU$0.32. The stock touched an intraday low of AU$0.29 on Thursday.

Renascor Resources’ share price has gained nearly 64% on a year-to-date basis. The stock of the battery materials explorer has risen over 168% in the past year. In the past month, the stock has risen by 18%.

What’s weighing on Renascor Resources?

Renascor Resources shares were trading on a weak note after the company launched and completed a fully underwritten institutional placement. The company raised nearly AU$70 million from institutional investors at a 14% discount of 27.5 cents per share.

According to the ASX release, the proceeds from the placement will be used to boost the development of the Siviour Battery Anode Material (BAM) project.

What did Renascor Resources’ management say?

Renascor’s managing director, David Christensen, was upbeat about the latest development. “The completion of this placement caps off a transformational year for Renascor. The strong demand received from both domestic and offshore institutional investors is a testament to the world-class nature of the BAM project and the significant steps undertaken by the Company to progress its development, following the recent receipt of the PEPR approval and grant of a conditional A$185 million Australian Government loan under the Critical Minerals Facility,” he said.

“The introduction of these high-quality investors, together with the support shown by existing shareholders, has provided Renascor with the flexibility to bring forward construction and operation of the Siviour upstream operations and allows the Company to take a staged, derisked approach to BAM project development,” Christensen added.

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