St George Mining (ASX: SGQ) has received firm commitments for a placement of shares to raise $20 million via the issue of 1,000,000,000 ordinary shares to institutional and sophisticated investors at an issue price of $0.02 per share. Subscribers to the placement will also receive one free attaching option for every two shares subscribed for and issued, with each option having an exercise price of $0.04.
Proceeds from the placement will be applied towards acquisition costs, exploration expenses and working capital for the Araxá niobium-REE project in Minas Gerais, Brazil – located adjacent to CBMM’s industry leading niobium mine.
St George and the seller of the Araxá project have entered into a variation of the binding conditional agreement initially signed on 3 August 2024 to allow additional time up to 15 March 2025 to complete the acquisition. St George will convene a general meeting of shareholders in early to mid-February 2025 at which approval for the capital raising and other payments to complete the acquisition of the Araxá project will be sought.
Araxá is a de-risked, world-class project with extensive high-grade niobium and REE mineralisation confirmed by drilling, a long history of commercial niobium production in the region, access to infrastructure and workforce, first-rate in-country management and government support for expedited project approvals.
High-grade mineralisation commences from surface, with more than 500 intercepts of high-grade niobium (>1% Nb2O5) and rare earths with grades up to 8% Nb2O5 and 33% TREO.
The placement announced today replaces an earlier equity raising proposal announced at the time of the Araxá project acquisition agreement.
“We are delighted to be able to announce that funding for the acquisition of the Araxá project has been arranged, with very strong investor interest for our $20 million raise. We thank our shareholders for their patience as we work towards concluding this transformative acquisition for our company,” executive chairman John Prineas said.
“St George has been very active in laying the platform to leverage the advanced status of the project – including the signing of a cooperation agreement with the State of Minas Gerais to expedite project approvals, the signing of partnership agreements for potential downstream processing of the Araxá mineralisation, the appointment of industry leading environmental consultants and, of course, establishing our own high-quality, in-country team with more than 40 years’ combined experience in the niobium business.
“The successful capital raise recognises the de-risked nature of the Araxá project – with extensive high-grade niobium and rare earths mineralisation already confirmed by drilling – at a time when these critical metals are highly sought after globally by industry and governments alike.
“Work programs have already been planned for 2025 including drilling at Araxá that will start once we take ownership of the project.
“We look forward to finalising the acquisition of the project in Q1 2025 and advancing initiatives at Araxá to unlock the full potential value of this world-class asset.”
