- Exploration and mining company IGO (IGO) will secure a strategic stake in fellow ASX-listed New Century Resources (NCZ)
- IGO will invest up to $27 million in New Century, earning it up to an 18.4 per cent stake in the company and a seat on its board
- New Century today launched a $51.1 million capital raising to provide working capital for its Century Zinc Mine in Queensland
- This is comprised of a $23.775 million placement to IGO and an entitlement offer for which IGO is a sub-underwriter
- Shares issued under the placement and entitlement offer will be priced at 15 cents each
- New Century shares are yet to resume trade from a voluntary suspension ahead of the announcement, shares last traded for 15 cents each
- IGO is down 2.22 per cent with shares trading for $4.62 each
Exploration and mining company IGO (IGO) will secure a strategic stake in fellow ASX-listed New Century Resources (NCZ).
IGO will invest up to $27 million in New Century via a $23.775 million placement and by underwriting $3.225 million of an entitlement offer.
Today, New Century launched a $51.1 million capital raising to provide working capital for its Century Zinc Mine in Queensland.
If IGO receives its full allocation as a priority sub-underwriter, it will gain an 18.4 per cent stake in New Century. Additionally, it will receive a seat on the New Century board which it will retain as long as it owns at least 10 per cent of the company.
New Century Managing Director Patrick Walta welcomed the strategic partnership with IGO.
“New Century would like to welcome IGO to the register as a new strategic major shareholder. The company looks forward to working with the IGO team on opportunities for growth within the existing Century assets and beyond,” he said.
IGO has a strategic focus on clean energy and Managing Director and CEO Peter Bradford foreshadowed potential collaboration in this space.
“IGO is pleased to support New Century through this placement and looks forward to both the success of current operations and potential collaboration with the company on any future clean energy metals focused exploration or other business development initiatives that may add shareholder value for both companies,” he said.
The capital raising
New Century’s $51.1 million capital raising is made up of the $23.775 million placement to IGO and a $27.3 million fully-underwritten entitlement offer. Shares under both the placement and the entitlement offer will be issued at 15 cents each.
The entitlement offer allows shareholders to purchase two new shares for every seven shares already held. The institutional component will be completed on April 22, while the retail component will be open from April 27 until May 15, 2020.
Canaccord Genuity has fully-underwritten the entitlement offer while IGO is the priority sub-underwriter for $3.225 million as part of its investment.
New Century shares are yet to resume trade from a voluntary suspension ahead of the announcement detailing the capital raising, shares last traded for 15 cents each. IGO is down 2.22 per cent with shares trading for $4.62 each at market close.