Photo by: Reuters
PERTH (miningweekly.com) – Diamond miner Kimberley Diamonds has deferred a planned capital raising, owing to the prevailing market conditions.
In March this year, the mine proposed the placement of some 30-million shares to professional and sophisticated investors.
The company said on Tuesday that the capital raising was called off, as the board was conscious of unnecessarily diluting its existing shareholder base, given the pricing levels currently available.
Kimberley Diamonds currently has a cash balance of about A$9.7-million with no debt, and the miner said that it was fully funded to support its existing operations. The board also believed that the current cash reserves and future operating cash flows from the Ellendale 9 operation would be sufficient to fund capital expenditure to restart the Ellendale 4 mine, which was scheduled for October.
The recommissioning of the Lerala diamond mine, in Botswana, and the start of mining operations at Smoke Creek, would be postponed until funding became available, either through cash flow or external sources.
Kimberley Diamonds told shareholders that the company had been presented with alternate, nondilutive options to fund its development programme, which the board would now consider.