Ionic Rare Earths Ltd (ASX:IXR, OTC:IXRRF) has raised A$5.9 million in an oversubscribed placement at $0.021 per share to fund demonstration plant activities at the magnet recycling facility in Belfast, Northern Ireland and at the Makuutu Rare Earths Project in Uganda.
The placement, through the issue of 280,952,381 fully paid ordinary shares, was strongly supported by new and existing institutional and sophisticated investors.
The company has also launched a share purchase plan (SPP) for existing shareholders at the same price, hoping to raise an additional $2 million.
Strong support for strategy
“The strong response to the raise reflected the potential of the company as a unique magnet and heavy rare earth development opportunity with the potential to become an end-to-end vertically integrated rare earth and magnet supply chain participant,” IonicRE managing director Tim Harrison said.
“The recent updates on the company’s progress of the demonstration plants at Makuutu and the Ionic Technologies' Belfast recycling facility, together with continuing advanced discussions to increase its interests in the Makuutu Rare Earths Project from its current 60% interest, augur well for positive news flow in the coming months.”
Placement details
The $0.021 issue price of the placement shares represents an 18.9% discount to the volume-weighted average price of IonicRE’s share price over the last 10 trading days.
The placement shares are expected to be issued on November 24, 2023.
Sufian Ahmad, a director of the company, will subscribe for about 19 million shares worth about $400,000, subject to shareholders’ approval at a meeting to be held early next year.
Canaccord Genuity (TSX:CF, LSE:CF) (Australia) Ltd and MST Financial Services Pty Ltd were joint lead managers for the fund-raising.
More funds for war chest
Existing shareholders with a registered address in Australia or New Zealand as of November 17, 2023, will be eligible to apply for new shares under an SPP, without incurring brokerage fees.
The company may raise up to $2 million, before costs, under the plan.
Eligible shareholders may apply for up to $30,000 worth of shares.
Further information, including the terms and conditions, will be made available on November 28, 2023.