Magmatic Resources Ltd (ASX:MAG) has had a strong start to its $4 million capital raising program with firm commitments received for $3 million in an oversubscribed placement.
Binding commitments have been received from institutional and professional investors for the placement which has been strongly supported by new and existing investors.
The company is also delighted to introduce a number of offshore institutions to its register.
Existing eligible shareholders will also be offered the opportunity to participate in a non-underwritten share purchase plan (SPP) to raise up to $1 million.
Use of funds
Funds raised will be applied to the expansion and acceleration of a high-impact drilling program at the Myall Project in Central West NSW following strong initial results from drilling at the Corvette Prospect.
The capital raising also allows Magmatic to continue evaluating other high-priority targets in its portfolio and provides additional working capital.
“Excited by opportunity” at Myall
Magmatic’s managing director Dr Adam McKinnon said: “Magmatic thanks its existing shareholders for their continued support and looks forward to welcoming a number of new incoming shareholders to the register.
"We are exceptionally excited by the opportunity this capital raising provides the company towards defining a potential Tier 1 porphyry copper-gold deposit at Myall.”
Placement details
The placement will comprise the issue of 30.206 million new fully paid ordinary shares at an issue price of $0.10 per share.
New shares will be issued in line with the company’s placement capacity under ASX Listing Rule 7.1 and 7.1A, and rank pari passu with fully paid ordinary shares in Magmatic.
The placement price represents a:
- 9.1% discount to Magmatic’s last close (November 11, 2022) of $0.110 per share;
- 21.9% discount to the 5-day volume-weighted average price (VWAP) of $0.128 per share; and
- 15.2% discount to the 10-day VWAP of $0.118 per share.
Ord Minnett Limited and Canaccord Genuity (TSX:CF, LSE:CF) (Australia) Limited acted as joint lead managers for the placement.
SPP details
Under the SPP, eligible shareholders will have the opportunity to apply for up to $30,000 of new shares without incurring brokerage or other transaction costs at $0.10 per share, the same price as the placement.
The record date for participation in the SPP is Tuesday, November 15, 2022, and registered holders of shares at that date with a registered address in Australia, New Zealand or such jurisdiction that the directors may determine, will be eligible to participate.
The offer period for the SPP will open on Friday, November 25, 2022, and is expected to close at 5:00pm (AEDT) on Friday, December 9, 2022.
New shares to be issued under the SPP will be issued in line with the company’s placement capacity under ASX Listing Rule 7.1 and rank pari passu with fully paid ordinary shares.