Northern Minerals completes retail entitlement offer

Northern Minerals completes retail entitlement offer

Australian heavy rare earths producer, Northern Minerals Limited (ASX: NTU) has completed the retail component of its accelerated non-renounceable 1 for 13 pro-rata entitlement offer, raising about $4.3 million.


Australian heavy rare earths producer, Northern Minerals Limited (ASX: NTU) has completed the retail component of its accelerated non-renounceable 1 for 13 pro-rata entitlement offer, raising about $4.3 million.

The Retail Entitlement Offer closed at 5:00pm (AEST) on 8 July 2019 and raised a total of approximately $4,276,795 (before costs) at an offer price of $0.045 (Offer Price) per new share (New Share).

The Company also received strong demand for additional New Shares (in excess of entitlements) under the Top-Up Facility as detailed in the Retail Offer Booklet.

As a result, the Company was required to scale-back applications for additional New Shares and Eligible Retail Shareholders who applied for additional New Shares (in excess of their entitlement) will be allocated approximately 26.7% of such additional New Shares applied for.

Excess funds received by the Company in relation to the Retail Entitlement Offer will be refunded in accordance with the terms of the Retail Offer Booklet. The Retail Entitlement Offer follows the institutional component of the Entitlement Offer, which raised $2,662,054.70 (before costs).

In total, applications were received from Eligible Retail Shareholders for approximately 71.3% of shares available under the Retail Entitlement Offer. Eligible Retail Shareholders also subscribed for a further approximately $4.5 million of additional New Shares in excess of their entitlement through the Top-Up Facility (approximately $3.3 million of which will be refunded as set out above).

As a result, a total of approximately $6,938,849 was received under the Entitlement Offer representing the maximum amount that could be raised.

The Company intends to use the funds raised under the Entitlement Offer and the placement announced on 6 June 2019 to:

(1) meet commitments to the Australian Taxation Office (ATO) in accordance with the in-principle agreement with the ATO regarding repayment of amounts owing as described in the ASX announcement dated 5 June 2019 (pending the outcome of the Company’s rights of review as described in the ASX announcement dated 17 May 2019);

(2) progress the Company’s enhancement initiatives at Browns Range, including further exploration, ore sorting and product separation; and

(3) provide general working capital. New Shares issued under the Retail Entitlement Offer will rank equally with existing shares on issue.

New shares under the Retail Entitlement Offer will be issued on 15 July 2019 and will commence trading on a normal settlement basis on the ASX on 16 July 2019. Holding statements will be despatched on or around 17 July 2019.

Through the course of the Entitlement Offer, the Company received strong and excess demand for its shares from certain institutional investors who have expressed that they would commit to subscribing for further shares at $0.045 per share to raise up to approximately $8.4 million (before costs) in additional funds for the Company.

The Board has not yet determined whether it will carry out an additional placement to meet this excess institutional demand and a separate ASX announcement will be made if the Board resolves to do so. Any such placement would utilise the Company’s existing placement capacity under ASX Listing Rule 7.1.

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