Australian Strategic Materials Ltd (ASX:ASM, OTC:ASMMF) has bolstered its war chest in the lead-up to a Final Investment Decision (FID) on the Dubbo Project in Central West New South Wales after completing an entitlement offer to raise ~$1.6 million.
The offer closed on Monday, May 27, 2024, and follows the recent placement which raised $15 million, taking total recent capital raising proceeds to ~$16.6 million.
Directors show confidence
Showing their confidence in the company and its critical minerals strategy, the offer attracted meaningful support from major shareholders and directors who subscribed for shares valued at ~$1.4 million.
This included Ian Gandel, the company’s chair and major shareholder, via his investment entity Abbotsleigh Pty Ltd.
Funds raised will primarily go towards demonstration of required ASM co-commitments to enable government funding for critical path items associated with taking the company to an FID regarding the Dubbo Project.
“Delighted” with support
ASM’s managing director and CEO Rowena Smith said: “We are delighted with the level of support we had for the offer. I would like to take this opportunity to thank shareholders for their support.
“The funds raised under the offer will assist ASM to demonstrate it has the required co-commitments to enable government funding that will be used to progress key critical path activities to take final investment decision for the Dubbo Project.
"We are looking to capitalise on this momentum to accelerate progression towards FID.”
Offer details
ASM received applications from eligible shareholders for 1,410,541 entitlement offer shares and 1,410,541 options at the offer price of $1.16 per share, representing a ~31.4% take-up.
The entitlement offer shares and options were issued on June 3, 2024, and are expected to begin trading on ASX on a normal basis from the market open on June 4, 2024.
Entitlement offer shares and any new shares issued on exercise of an entitlement offer option, will rank equally with existing ASM shares then on issue.
As well as the co-commitments, capital-raising proceeds will provide general working capital and funding for general corporate costs.
Shortfall provisions
There were 3,082,534 entitlement offer shares and an equivalent number of offer options not taken up as part of the offer.
Directors of the company reserve the right to place the shortfall securities within three months of the entitlement offer closing date, that is, on or before August 27, 2024.
Any shortfall securities will be offered at a price not less than the offer price under the entitlement offer.