PERTH (miningweekly.com) – Iron-ore producer Gindalbie Metals has secured the A$175-million institutional component of its A$206-million capital raising, it reported on Friday.

The institutional placement consisted of a A$111,8-million share placement to eligible institutional investors, comprising about 120,2-million shares at A$0,93 a share. It also consisted of a conditional placement to Gindalbie’s joint-venture (JV) partner Ansteel, to raise A$63,2-million.

Gindalbie said on Wednesday that it was looking to raise between A$175-million and A$206-million for the development of the Karara iron-ore project, in Western Australia.

Besides the institutional placements, Gindalbie was also offering a share purchase plan to raise A$20-million.

Gindalbie MD Garret Dixon commented that the strong institutional support demonstrated the market’s appetite to invest in large, long-life resource projects.

However, he noted that the uncertainty surrounding the proposed resources tax and its impact on the financial returns of projects such as Karara had made investors “extremely” nervous and more uncertain in their investment decisions.

“This new institutional support significantly broadens and enhances our share register for the benefit of all shareholders. Gindalbie is now an ASX-200 company, but still has a relatively low level of institutional shareholders,” Dixon said.

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