Cyprium Metals Ltd (ASX:CYM, OTC:CYPMF) is looking to raise up to A$29 million through a conditional placement and entitlement offer to support an operational restart at the Nifty Copper Project in WA.
The explorer has secured firm commitments to raise the bulk of the capital — A$24 million, to be exact — through a 600-million-share placement, executed at 4 cents apiece.
The placement was strongly supported by sophisticated and professional investors, including numerous new and existing high-quality domestic and offshore natural resources-focused institutions.
Investors also have a chance to get their foot in the door during a pro-rata, non-renounceable entitlement offer, where they can pick up one new share for every 10.64 held by the record date, with a target of A$5 million.
Nifty restart on the cards
With fresh capital in the pipeline, Cyprium has set its sights on a new chapter for its Nifty copper operations.
The plan is to develop a large-scale open-pit mine, which will lower the development’s capital requirements and overall risk.
A starter oxide operation will complement the large-scale sulphide open pit, together supporting a 15-year-plus mine life based on a copper resource that exceeds 900,000 tonnes.
Cyprium has finalised a restart study for its starter operation and is onto the scoping stage, which will lead to a detailed open pit life of mine study for the Nifty asset.
This integrated plan is expected to support a long-life production model with the oxide operation expected to generate up to 25,000 tonnes of copper cathode.
Down the line, a sulphide concentrator is piqued to produce as much as 40,000 tonnes of copper in concentrate every year.
Beyond Nifty, Cyprium believes there’s growing interest in its Maroochydore and Murchison exploration projects.
The company continues to build out its WA copper portfolio, which together hosts more than 1.6 million tonnes of contained copper.
New management on the way
Aside from the raise and restart plans, there are also board and management changes on the cards: once the placement shares are issued, Cyprium plans to appoint Clive Donner as its new managing director.
Donner has experience financing more than 50 global mines and has founded two private equity funds, predominantly focused on emerging and mid-tier mining companies.
Once the new MD joins the team, Barry Cahill plans to step down from the board, although he will continue in an executive capacity.
Ahead of his appointment, Donner, said the cap raise would pave the way for Nifty’s restart.
“The board is very appreciative of the strong support shown from current shareholders and is looking forward to welcoming a number of new institutional investors onto the register.
“Once this equity raising has been completed, Cyprium will be able to continue to advance the Nifty technical studies and funding package enabling the delivery and execution of our strategy as an integrated copper oxide Heap Leach SX-EW starter operation and the larger scale sulphide open pit operation.”
Placement participation
Leading private equity firm and existing shareholder Pacific Road Capital Management (PRCM) has agreed to subscribe for approximately A$4.05 million in the placement, representing a pro forma 9.9% interest in the company post-placement.
Current non-executive director John Featherby has agreed to subscribe for 5 million shares under the placement, incoming managing director Clive Donner has agreed to subscribe for 12.5 million shares and incoming chief operating officer Milan Jerkovic and associates have agreed to subscribe for 12.5 million shares.
Subscribers for the placement shares will be entitled to participate in the proposed entitlement offer, which will proceed following the issue of the placement shares and reinstatement of the company’s shares to trading on the ASX. The offer price represents a 63.6% discount to the last traded price of $0.11 on February 20, 2023.
Each participant in the placement and entitlement offer will receive one free attaching option for every two shares to be issued. The options will be exercisable at $0.06 each, on or before December 31, 2024.
Canaccord Genuity (TSX:CF, LSE:CF) (Australia) Limited is acting as the lead manager to the placement and Steinepreis Paganin is acting as legal adviser to Cyprium.