Stavely Minerals raises $5.3m to advance namesake copper-gold project
Stavely Minerals is seeking to raise $4 million through a placement of new shares priced at $0.15 each, and a further $1.5 million through a share purchase plan.
Stavely Minerals (ASX: SVY) has closed out a capital raising with more than $5.3 million in share purchase plan subscriptions representing a 350% increase on the targeted amount of $1.5 million.
Subsequent to the end of the June quarter, eligible shareholders were given the opportunity to subscribe for new Stavely shares up to a maximum value of $30,000 at an issue price of $0.15 per share.
In light of the strong demand, the company has confirmed that all valid applications will be accepted in full.
Stavely executive chairman Chris Cairns said the share purchase plan was launched after release of a maiden resource estimate for Cayley Lode, which is part of the Stavely copper-gold project in western Victoria.
It followed the completion of a placement at $0.15 cents per share to sophisticated and institutional investors which raised $4 million before costs.
Worst day for global markets
Mr Cairns said the Cayley Lode estimate was released on the “worst day” for global financial markets in more than a decade.
“We were then forced to undertake a capital raising at a significant discount to an already weakened share price, agreeing to a small placement of $4 million to minimise share capital dilution,” he explained.
“We are delighted that our shareholders have elected to participate in this capital raising to the extent that they have … I have never seen a situation where a share purchase plan raises more money than the institutional and sophisticated investor placement.”
Sign of support
The “unprecedented” response was considered a sign of support for the company.
“Our shareholders have sent a clear message that they recognise the pathway we have outlined to grow the Cayley Lode resource, advance it towards development and unlock the Stavely project’s broader potential,” Mr Cairns said.
“Their support will give us the financial capability to pursue the substantial potential we have identified at depth and along strike at Cayley Lode … we are confident the resource estimate represents the beginning of something much larger.”
A total of 35.3 million new Stavely shares will be issued to eligible shareholders this week.
Stavely funding
Mr Cairns confirmed that funds from the share purchase plan and placement would be applied to the next phase of exploration and resource definition drilling at the Stavely project.
He said the company was also in the process of securing approximately $2.5 million of secured debt from sophisticated investors to complete the acquisition of land adjacent to the Thursday’s Gossan copper-gold prospect.
It has since reduced the amount of debt to $1.6 million in light of the share purchase plan oversubscriptions.