Coal Fe's share price drops as it announces acquisition, capital raising plans
PERTH (miningweekly.com) – ASX-listed Coal Fe Resources on Friday revealed that it was on the verge of acquiring a 50 000 t/m producing coal mine, in Indonesia, as well as that it was planning to restructure its board and raise cash.
Coal Fe noted that the project would be acquired in return for shares, with a heads of agreement anticipated to be signed in the near future.
The coal mine, in South Kalimantan, was currently exporting its product to a Chinese power group. Coal Fe said it would look to increase production from the mine, should negotiations prove successful.
The company further told shareholders that it was considering a A$5-million capital rise to fund its existing and new projects. The capital raising would be conducted in the form of equity, convertible notes or debt.
Meanwhile, Coal Fe also told shareholders that it would restructure its current board, with Robert Swarbrick expanding his role to executive chairperson, while an independent executive director would be appointed.
Coal Fe shareholders were less than impressed with the company’s plans, with the company’s share price falling some 25%, to trade at a low of 1.5c a share.
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