Key points
- The Centaurus Metals share price is sinking by more than 7% in afternoon trading
- The company is conducting a $75 million capital raise
- The funds will help pay for its Jaguar Nickel Sulphide project.
The company’s shares are currently swapping hands at $1.19, down 7.39%. They had been placed in a trading halt on Wednesday morning ahead of the impending announcement.
Let’s take a look at what the mineral exploration company revealed today.
What’s weighing on the Centaurus Metals share price? Investors are pushing down the Centaurus Metals share price after the company announced it is conducting a capital raise for its Jaguar Nickel Sulphide project.
Centaurus Metals will conduct a $75 million institutional placement at $1.16 per share. The company said it had received support from more than 20 Australian and international institutional investors.
The company is raising the funds for a definitive feasibility study for the mine and to keep up its drilling program.
The Jaguar Nickel Sulphide project in northern Brazil is 100% owned by Centaurus Metals. The company is planning a 90,000 metre exploration venture in 2022 involving “significant ongoing diamond drilling”.
In December, the company revealed it had seen a 30% increase in its mineral resource estimate at the project.
The capital raise will also help the company fund pre-development and financing activities ahead of a final investment decision on the project in the third quarter of 2023.
The placement will increase the company’s cash balance to $83 million.
Management commentary Speaking about the capital raise, managing director Darren Gordon said:
We are delighted with the very strong level of interest received from global investors for this milestone capital raising – which really puts Centaurus in an outstanding position to realise our objective of becoming one of the world’s next significant green nickel producers.Centaurus Metals will issue 64,655,172 new shares to the market on February 1.The strong interest in this raise reflects both the scale and quality of the Jaguar Project and its impeccable ESG credentials, combined with the clear corporate strategy we have outlined to bring it into development as quickly as possible.
Centaurus Metals share price snapshot The Centaurus Metals share price has returned around 37% in the past year. In the past month, it has gained just over 2% while it is down more than 17% in the past week.
Meanwhile, the S&P/ASX 200 Index (ASX: XJO)’s has returned 5.6% over the past 12 months.
The post The Centaurus Metals (ASX:CTM) share price is tumbling 7% today. Here’s why appeared first on The Motley Fool Australia.
Motley Fool contributor Monica O'Shea has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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