PERTH (miningweekly.com) – Copper developer Hot Chili is hoping to raise A$8.9-million through a private share placement and a rights issue to fund work at its Cortedera project, in Chile.
The ASX-listed company on Monday said it had successfully arranged for a A$5-million private placement to sophisticated and professional investors to place 333.33-million shares at a price of 1.5c each.
The share placement will not require shareholder approval.
Placement participants will also be entitled to one free attached unlisted option for every two shares issued under the placement, exercisable at 2.5c each and expiring in May 2022.
In parallel, Hot Chili will also conduct a non-renounceable pro-rata entitlement offer, offering three fully paid ordinary shares for every 20 shares held, also at a price of 1.5c each. The shares will come with one free attaching option for every two shares issued, exercisable at 2.5c each before May 2022.
The entitlement offer is expected to raise a further A$3.9-million.
Hot Chili MD Christian Easterday told shareholders that the capital raise removed near-term funding uncertainty and provided a pathway to delivering several transformational catalysts over the coming months, including the satisfaction of a $2-million fee to extend the remaining payment schedule for the acquisition of Cortadera by 12 months, the restart of drilling activities, a first resource estimate for the Cortadera and San Antonio projects, the completion of metallurgical testwork and a preliminary economic assessment, and the execution of a formal lease mining and processing agreement with the Chilean government at the Productora project.
The funding facilitated a major repositioning of the company’s copper and gold resource base, and the restart of drilling across large extensions to the Cortedera discovery, Easterday said.
“With each hole, the Cortadera discovery has expanded, delivering six world class copper/gold drill results already, and still remaining open.
“We look forward to continuing our push to rapidly grow Cortadera while also working towards establishing a new and expanded, combined development plan for our coastal copper/gold assets in Chile.”