PERTH (miningweekly.com) – Coal miner Atrum Coal has raised A$20-million through a two tranche share placement to progress its Elan hard coking coal, in Alberta Canada, taking advantage of the spotlight cast by a recent takeover offer for its neighbor Riversdale Resources.
Hancock Prospecting last week announced an A$2.20 a share all cash offer for the unlisted Riversdale Resources, with the company prepared to increase its offer price to A$2.50 a share once its shareholding in Riversdale reached more than 50% before the close of the offer.
The offer saw the share price of Atrum spike, as the company’s Elan project is located adjacent to Riversdale’s Grassy Mountain hard coking coal project.
Atrum on Friday said that the company would now place some 114.3-million shares, at an issue price of 17.5c each, to raise funds to progress its Elan project through feasibility work and towards formal permitting applications.
The first tranche of the placement will consist of 83.2-million shares, raising an initial A$14.6-million, and will be conducted under the company’s existing placement capacity.
The second tranche of 31.1-million shares, raising an additional A$5.4-million will be subject to shareholder approval at a general meeting scheduled for April 15.
“We are highly encouraged by the strong level of demand received for this equity raising,” said Atrum MD Max Wang.
“We believe it highlights a rapidly growing appreciation for the underlying value potential of our flagship Elan hard coking coal project in Alberta. We are now well funded to accelerate our drilling and evaluation activities across multiple project areas at Elan, with a view to rapidly progressing through key feasibility work and towards formal permitting applications for Elan South.”