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Hazer Group (ASX:HZR) - Managing Director, Geoff Ward
Managing Director, Geoff Ward
Source: Finance News Network
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  • Hydrogen producer Hazer Group (HZR) has received binding commitments to raise $8.4 million
  • The placement had to close early due to strong demand, and, as a result, the size was increased from $6 million to $8.4 million
  • 20 million shares will be issued to sophisticated and institutional investors at 42 cents each
  • The money raised will be used to construct Hazer’s Commercial Demonstration Plant and support its ongoing research and development
  • The company also announced that it has executed a non-binding term sheet for a $6 million loan facility
  • The facility will expire on March 31, 2025, and Hazer will be able to pay the total amount in three repayments, worth $2 million each
  • Hazer has dropped 21.1 per cent in mid-morning trade and shares are selling for 45 cents each

Hydrogen producer Hazer Group (HZR) has received binding commitments to raise $8.4 million.

The company also announced that it has executed a non-binding term sheet for a $6 million loan facility.

Placement

Hazer had to close the placement early due to strong demand, and, as a result, the size was increased from $6 million to $8.4 million.

To raise the $8.4 million, a total of 20 million new fully paid shares will be issued to institutional and sophisticated investors at a price of 42 cents each.

This price represents a 26.3 per cent discount to the last traded price of 57 cents and a 17.5 per cent discount to the 15-day volume-weighted average price.

The shares are expected to settle on June 17 and be issued and begin trading on the ASX on June 18.

The money raised from the placement will be used to construct Hazer’s Commercial Demonstration Plant (CDP) and support its ongoing research and development program.

This plant will be the first fully integrated, large-scale deployment of the Hazer Process.

The Hazer Process is a low-emission hydrogen and graphite production process that uses iron ore to convert natural gas and methane feedstocks into hydrogen and high-quality graphite.

“With the completion of this funding package, Hazer is strongly positioned to construct, commission, and operate our Commercial Demonstration Project, a major milestone in scaling up the Hazer technology,” Chairman Tim Goldsmith commented.

“I look forward to working with the Hazer team to finalise the project arrangements and take a final investment decision on the project in the immediate future,” he said.

Loan facility

This $6 million loan facility will expire on March 31, 2025, and Hazer will be able to pay the total amount over three repayments, worth $2 million each.

However, this is subject to execution of its ARENA (Australian Renewable Energy Agency) funding agreement.

ARENA funding agreement

Executed in May 2020, Hazer announced a binding Gas Supply Agreement and Collaboration Deed with the Water Corporation.

Under this agreement, the Water Corporation will supply biogas (gases produced by the breakdown of organic matter such as plant material, food waste, or manure) at its Woodman Point Wastewater Treatment plant for Hazer’s CDP.

Hazer is continuing to work with ARENA to satisfy the outstanding conditions in the agreement.

“I would also like to thank Water Corporation for their engagement and support in completing the binding agreements for biogas supply and project collaboration, and ARENA for their ongoing support in funding this exciting Australian developed technology,” Tim added.

Hazer has dropped 21.1 per cent in mid-morning trade and shares are selling for 45 cents each at 10:41 am AEST.

HZR by the numbers
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