South Harz Potash Ltd (ASX:SHP) is generating up to $4 million to progress the Ohmgebirge Potash Project in Germany in a cost-effective, targeted manner, preparing to enter a strengthening potash fertiliser market.
The company has raised $1.03 million through binding commitments in a placement of 103 million shares at $0.01 each and proposes to raise an additional $2.97 million via a 1-for-3 pro-rate non-renounceable rights issue at the same price for a total of $4 million.
Optimising Ohmgebirge, acquiring Sollstedt
“The South Harz board and management team thank our existing investors for their continued support and warmly welcome new shareholders to our register,” South Harz executive chair Len Jubber said.
“This additional funding will assist us in completing detailed due diligence activities and executing targeted binding agreements for the transformational Sollstedt Mine acquisition while undertaking internal value engineering and optimisation studies for the brownfield Ohmgebirge Potash Development.
“Following the recent favourable Spatial Planning Assessment, we are well positioned to advance Ohmgebirge in a cost-effective manner, optimising its potential into a strengthening potash market.”
Read: South Harz Potash wraps Ohmgebirge pre-feasibility, picks up Sollstedt mine and releases maiden ore reserve
Directors subscribe
In a show of confidence, the company’s directors, Len Jubber, Rory Luff and Reinout Koopmans, are subscribing for a total of more than 40 million shares, contributing A$401,167.
The capital raising proceeds will go to:
- detailed due diligence activities, ahead of the execution of binding agreements for the transformational Sollstedt Mine acquisition;
- internal value engineering and optimisation studies for the brownfield Ohmgebirge Potash Development;
- evaluation of strategic alternatives towards a definite feasibility study (DFS) for the Ohmgebirge Potash Development;
- general working capital for technical and business running costs; and
- costs associated with the capital raise.
South Harz holds four projects across central Europe with a global potash mineral resource estimate of 5.1 billion tonnes at 10.6% potassium oxide inferred and 258 million tonnes at 12.2% in the indicated category.