Northern Minerals (ASX: NTU) has entered into subscription agreements to raise $15 million by way of a placement and is undertaking a 1 for 13 accelerated non-renounceable entitlement offer at A$0.045 per share to raise approximately A$6.95 million, all before costs. The Entitlement Offer will involve the issue of up to approximately 154,451,564 new fully paid ordinary shares in the Company.
Northern Minerals Limited (ASX: NTU) has entered into subscription agreements to raise $15 million by way of a placement and is undertaking a 1 for 13 accelerated non-renounceable entitlement offer at A$0.045 per share to raise approximately A$6.95 million, all before costs.
The Entitlement Offer will involve the issue of up to approximately 154,451,564 new fully paid ordinary shares in the Company.
The Placement is for the issue of 333,333,333 New Shares at an issue price of A$0.045 per share to sophisticated investors in Australia and the British Virgin Islands. The issue of New Shares under the Placement is conditional on shareholder approval and subscription funds are due to be received in three equal tranches of A$5 million on or before 31 August 2019, 30 September 2019 and 31 October 2019 (assuming shareholder approval is obtained before then).
The Placement shares will be subject to voluntary escrow by way of a holding lock to be placed on those shares for a period of 12 months from the date of issue. The Company will despatch a notice of meeting in due course in relation to the Placement.
The Company intends to use the funds raised under the Placement and Entitlement Offer 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.
If all eligible shareholders do not take up their full entitlement and it is not possible to place the entire shortfall then the Company intends that the gross proceeds received from the Entitlement Offer will be applied firstly towards meeting the costs of the offer and then towards the above items in the order that they are set out, to the extent possible.
Accelerated Non-Renounceable Entitlement Offer
The Entitlement Offer is comprised of:
· an accelerated institutional component to be conducted between 7 June 2019 and 11 June 2019 (Institutional Entitlement Offer); and
· a retail component which is anticipated to open on 17 June 2019 and close on 8 July 2019 (Retail Entitlement Offer).
The record date under the Entitlement Offer is 7.00pm (AEST) on 12 June 2019 (Record Date).
Entitlements are non-renounceable and accordingly cannot be traded on the ASX.
The Entitlement Offer is not underwritten and any shortfall shares will be placed by the directors at their discretion subject to compliance with the Corporations Act 2001 (Cth) and the ASX Listing Rules within 3 months from the closing date of the offer.
The Offer Price of A$0.045 per New Share under the Entitlement Offer represents a discount of 43.04% to A$0.079, being the last closing price of shares in the Company before announcement of the Entitlement Offer.
The Offer Price also represents a discount of 41.95% to the 10 day VWAMP of shares in the Company before announcement of the Entitlement Offer.
The New Shares to be issued will rank equally with existing shares on issue in the Company at that time.
Institutional Entitlement Offer
Eligible institutional shareholders will be invited to participate in the Institutional Entitlement Offer which opens on 7 June 2019 and closes on 11 June 2019.
Under the Institutional Entitlement Offer, eligible institutional shareholders (being investors from Australia, New Zealand, China, Switzerland, Hong Kong and Seychelles who do not require a local prospectus or registration) can choose to take up all, part or none of their Entitlement.
New Shares in relation to Entitlements not taken up under the Institutional Entitlement Offer, or New Shares in relation to entitlements that would otherwise have been offered to ineligible institutional shareholders, will be offered to eligible institutional investors and other institutional investors at the Offer Price through a bookbuild process.
Shares in the Company have been placed in a trading halt while the Institutional Entitlement Offer is undertaken. It is expected that the trading halt will end at market open on 12 June 2019.
New Shares under the Institutional Entitlement Offer are expected to be issued on 24 June 2019. The Company will, upon issue of the New Shares under the Institutional Entitlement Offer, seek quotation of the New Shares on ASX.
Retail Entitlement Offer
Eligible retail shareholders with a registered address in Australia or New Zealand as at the Record Date (Eligible Retail Shareholders), have the opportunity to take up their entitlement of New Shares at the Offer Price, on the terms and conditions outlined in the Retail Offer Booklet to be sent to Eligible Retail Shareholders on or around 17 June 2019. The Retail Entitlement Offer is anticipated to close on 8 July 2019.
Eligible Retail Shareholders can choose to take up all, part, or none of their Entitlements. Furthermore, the Retail Entitlement Offer will include a top up facility under which Eligible Retail Shareholders who take up their Entitlement in full may also apply for additional shares in the Retail Entitlement Offer that were not taken up by other Eligible Retail Shareholders.
There is no guarantee that applicants under the top up facility will receive all or any of the additional shares for which they apply.
New Shares under the Retail Entitlement Offer are expected to be issued on 15 July 2019. The Company will, upon issue of the New Shares under the Retail Entitlement Offer, seek quotation of the New Shares on ASX.
Please note that Shareholders with a registered address outside Australia or New Zealand on the Record Date are ineligible to participate in the Retail Entitlement Offer.