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Stellar Resources secures $10 million placement to boost Heemskirk Tin Project development

Published 24/05/2024, 11:09 am
© Reuters.  Stellar Resources secures $10 million placement to boost Heemskirk Tin Project development

Stellar Resources Ltd (ASX:SRZ, OTC:SLROF) says it has secured firm commitments to raise A$10 million through a placement at A$0.019 per share, representing a 4.6% premium to the company's 30-day volume weighted average price (VWAP).

Accelerating drilling

The placement was cornerstoned by two institutional investors, with Paradice Investment Management Pty Ltd committing A$3.9 million and Regal Funds Management contributing A$3.0 million.

The funds will be used to accelerate drilling, enhancing the resource category and exploring potential extensions to the known mineralisation at the Heemskirk Tin Project in western Tasmania.

The company will also advance metallurgical testwork and necessary environmental baseline studies as it progresses Heemskirk towards development.

Stellar has been in the process of completing updated feasibility studies at Heemskirk, using the September 2023 mineral resource estimate of 7.48 million tonnes at 1.04% tin, containing 77.87 thousand tonnes of tin.

This study is expected to be finalised in the third quarter of 2024.

Highest-grade undeveloped tin resource

This project is recognised as the highest-grade undeveloped tin resource in Australia and the third highest globally.

The tin price has experienced a significant increase of approximately 51% since late 2023, rising from US$22,910 per tonne to US$34,575 per tonne as of 20 May 2024.

With the completion of this placement, Stellar Resources will hold a strong cash position of around A$14 million, enabling the company to advance development activities and capitalise on the anticipated tin deficit.

The placement involves the issuance of 526.3 million new shares to sophisticated and professional investors. The first tranche of 388.4 million shares will be issued under the company's existing placement capacity.

The second tranche, comprising 137.9 million shares, is subject to shareholder approval at an extraordinary meeting scheduled for July 2024.

Taylor Collison Limited and Bell Potter Securities Limited acted as Joint Lead Managers for the placement.

Read more on Proactive Investors AU

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