Northern Minerals strengthens balance sheet with $20m placement

Northern Minerals strengthens balance sheet with $20m placement

Australian heavy rare earths producer, Northern Minerals Limited (ASX: NTU) has entered into multiple subscription agreements with a number of sophisticated investors, for the placement of 400,000,000 fully paid ordinary shares in the Company at an issue price of A$0.05 per share to raise A$20 million. Funds raised from the issue of the shares will be utilised for working capital purposes and exploration. The Board is also contemplating a possible Entitlement Offer on a 1-for-15 basis at a price of A$0.05 per share.


Australian heavy rare earths producer, Northern Minerals Limited (ASX: NTU) has entered into multiple subscription agreements with a number of sophisticated investors, for the placement of 400,000,000 fully paid ordinary shares in the Company at an issue price of A$0.05 per share to raise A$20 million.

Subscription funds are to be received by the Company (and shares will be issued) in various tranches as per below:

1) Tranche 1: A$10 million on or before 31 March 2019 and the 200,000,000 shares comprising Tranche 1 will be issued to various sophisticated investors either out of the Company’s existing placement capacity under Listing Rule 7.1, Listing Rule 7.1A or under the placement facility approved as resolution 11 at the shareholder meeting held on 26 February 2019. Shareholder approval will not be required for the issue of shares under Tranche 1, however the Company may seek to ratify the issue at future general meetings if applicable.

2) Tranche 2: A$5 million on or before 30 April 2019 subject to receiving shareholder approval for the issue of the 100,000,000 shares comprising Tranche 2.

3) Tranche 3: A$5 million on or before 31 May 2019 subject to receiving shareholder approval for the issue of the 100,000,000 shares comprising Tranche 3.

The Company proposes to hold a General Meeting in late April to (among other things) seek shareholder approval for Tranche 2 and Tranche 3. A Notice of Meeting will be despatched to shareholders shortly.

The issue price of A$0.05 represents a discount of 17.9% to the 20-day VWAMP, a 21.1% discount to the 15-day VWAMP and a 29% discount to the 5-day VWAMP.

Funds raised from the issue of the shares will be utilised for working capital purposes and exploration. The Board is also contemplating a possible Entitlement Offer on a 1-for-15 basis at a price of A$0.05 per share.

An announcement will be made in due course if the Board decides to launch such offer. A success fee of 6% on the funds raised will be payable in shares (at $0,05 per share) or cash to AFSL holders that have introduced funds, at the Company’s election, once funds have been received by the Company.

Northern Minerals Managing Director, George Bauk, said, “The Placement will allow us to ramp up exploration at the high-grade Dazzler and Iceman prospects and strengthen the balance sheet for working capital purposes.

“The support for the Placement was excellent, with many parties now having a better understanding of the important role of heavy rare earths in the electric vehicle sector."

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