OzAurum Resources Ltd (ASX:OZM) will move quickly to get boots on the ground at its new Brazilian lithium projects after receiving commitments to raise A$2.4 million in a share placement.
Firm commitments have been fielded from a range of new sophisticated and institutional investors in the placement and the company will issue 31.75 million shares at $0.075 per share.
This represents a discount of 16.7% to OzAurum’s last traded share price and 18.8% to the 15-day VWAP.
Subscribers will also receive one free attaching option for every two new shares subscribed. These will have an exercise price of $0.11 each and an expiry date these years after issue.
Exploration plans
As well as beginning exploration at the lithium projects in Brazil, including at the Linopolis Jaime Lithium Project, funds will be allocated to progress the company’s scoping study at the Mulgabbie North Gold Project in Western Australia.
READ: OzAurum acquires lithium project in Brazil
At the new Linopolis Jaime project, the company intends to undertake first-pass geological mapping and geochemistry and diamond drilling while placement funds will also be used to continue to review additional projects in Brazil for potential acquisition.
“Can move quickly”
CEO and managing director Andrew Pumphrey said: “This raising ensures that OzAurum can move quickly to commence exploration of its new lithium projects in Brazil along with furthering the exploration at our WA gold projects.
"The Linopolis Jaime Lithium Project with a +7-metre-wide spodumene zone with an average grade of spodumene crystals of 6.94% LiO2 offers an immediate drill target and potential for a new lithium discovery.
"Significant upside also exists with over 20 LCT pegmatites identified within the project area to date.”
Shares have been as much as 22.23% higher in early trading to $0.11.
Placement details
The placement was very well supported by existing and new investors. It is within the company's capacity under ASX Listing Rules 7.1 and 7.1A with no shareholder approval required.
OZM will issue 31.75 million new shares from LR7.1 (19.05 million shares) and LR7.1A (12.7 million shares).
A total of $2,381,250 (before costs) will be raised from the placement and it is expected that the placement will settle, and new shares be issued, on September 27, 2023.
The company will also issue 15.875 million free attaching options with an exercise price of $0.11 each and an expiry date three years after issue.
Issuing these options will be subject to shareholder approval, which is to be sought at the company’s upcoming Annual General Meeting.
PAC Partners Securities Pty Ltd acted as lead manager to the placement.
"We would like to thank PAC Partners for acting as OzAurum’s lead manager and look forward to welcoming new shareholders to the company,” Pumphrey added.
Use of funds
As well as the project works, funds will also be used for the company’s general working capital including the costs of the issue.
OzAurum’s plans include:
- First-pass geological mapping and geochemistry at the Linopolis Jaime Lithium Project.
- Diamond drilling at the Linopolis Jaime Lithium Project.
- Progressing the Mulgabbie North scoping study.