- Venturex Resources (VXR) hopes to raise up to $4 million through a placement and share purchase plan
- The company has already received commitments for a $2.5 million placement under which it will issue 45.45 million new shares at 5.5 cents each
- Under the share purchase plan, existing shareholders can subscribe for up to $30,000 of new shares at 5.5 cents per share to raise $1.5 million
- Venturex will use the funds for follow-up exploration of high-grade intersections from the Breakers drill program conducted last year
- The company will also use the money to advance secondary approvals for the Sulphur Springs Copper-Zinc Project and for general working capital
- Company shares have dipped 4.69 per cent in the red and are trading for 6.1 cents each
Venturex Resources (VXR) has received binding commitments for a placement of 45.45 million new shares at 5.5 cents per share to raise $2.5 million.
Additionally, the company intends to undertake a share purchase plan (SPP) to raise up to $1.5 million.
The money from both the placement and SPP will be used for an exploration drilling program designed to follow-up high-grade intersections from the Breakers drill program conducted last year.
Following this program, Venturex plans to test multiple volcanogenic massive sulphides (VMS) targets identified along the highly prospective Panorama VMS Trend.
The company will also use the money to advance secondary approvals for the Sulphur Springs Copper-Zinc Project and for general working capital.
“Given the challenging market conditions for small-cap companies, we are very pleased with the strong support shown for the placement and welcome these new investors to our register,” Executive Director Anthony Reilly said.
The placement will be made to unrelated qualified, institutional, sophisticated and professional investors of Hartleys.
Placement participants will be issued with one attaching unlisted option for every two new shares subscribed. The options will be issued subject to shareholder approval and will be exercisable at 10 cents each on or before December 15, 2021.
The placement price represented a 14 per cent discount to the company’s last traded price and 17.6 per cent to the company’s 20-day volume-weighted average price (VWAP) just before launching the placement.
The placement will be completed in two tranches. The first tranche is for up to 34,418,400 shares to raise approximately $1.9 million. These shares are expected to be issued on Wednesday, June 17, 2020.
The second tranche will comprise a further 11,052,300 shares to raise the remaining $608,000. Together with all free attaching options, these shares will be issued subject to shareholder approval at a general meeting to be held in July.
Share purchase plan
Existing shareholders can subscribe for up to $30,000 of new shares at 5.5 cents per share. SPP investors will also be eligible to receive the one-for-two attaching option on the same terms as the placement.
Venturex’s largest shareholder, Northern Star Resources, with a 19.7 per cent shareholding, has the option to convert a proportion of its current $2 million loan, on the same terms as the placement and SPP, to maintain its position in the company up to 19.9 per cent relevant interest.
Company shares have dipped 4.69 per cent in the red and are trading for 6.1 cents each at 3:15 pm AEST.