Cyclone Metals Ltd (ASX:CLE) has successfully completed a placement raising A$1.87 million, with plans to raise an additional A$5.39 million through an underwritten rights offer.
The funds will primarily support the advancement of the Iron Bear project, debt reduction and general working capital.
Board changes; strategic developments
The company will convene a general meeting in September 2024 to discuss various resolutions, including a one-for-twenty consolidation of its securities.
The board will see new additions, with David Sanders joining as a non-executive director and Luke Martino set to be appointed soon.
Tony Sage, a founding shareholder and long-serving director, will transition to the role of non-executive chairman.
Sanders, principal of Bennett and Co, brings over 25 years of experience in corporate and resources law to the board.
Martino will join as a non-executive director before the placement is completed.
Funds raised will be allocated to:
- progressing the Iron Bear project;
- working capital and administration expenses;
- retiring loans and other creditors; and
- conducting a strategic review of other mineral exploration assets.
Progressing Iron Bear
The Iron Bear project, in the Labrador Trough, Canada, is one of the world's largest iron ore deposits, boasting a JORC-compliant mineral resource of 16.6 billion tonnes at 29.2% iron.
The project benefits from proximity to key infrastructure, including a heavy haul railway and an iron ore export port.
Cyclone Metals aims to establish a joint venture with a tier 1 miner or steel producer to bring the project to the decision-to-mine stage.
The technical team, led by executive director Paul Berend, is preparing to advance the project, with bulk samples expected to be available for steel mill clients in the third quarter of this year.
Placement details
The company has secured firm commitments to raise A$1,874,234 through the issue of some 2.34 billion shares at 0.08 cents per share.
The placement includes one free attaching unlisted option for every two shares issued.
RM Corporate Finance Pty Ltd will manage the placement and the upcoming rights offer, which aims to raise up to A$5.39 million.
A detailed timetable outlines the upcoming events, including a general meeting in September and the opening of the rights offer at the end of the same month.