Kalium Lakes sets A$30m raising target
PERTH (miningweekly.com) – Potash developer Kalium Lakes is hoping to raise A$22-million in a two tranche share placement and up to a further A$8-million in a share purchase plan (SPP) to fund the ramp-up of production at its Beyondie mine, in Western Australia.
Kalium Lakes on Thursday said that it had received firm commitments for the two-tranche placement, with the first tranche of up to 177.3-million shares to be issued under the company’s existing placement capacity, raising an initial A$7.1-million.
The second tranche of more than 372.7-million shares, raising more than A$14.9-million, will be subject to shareholder approval at a meeting scheduled for late September.
The shares will be issued at a placement price of 4c a share, representing a 56.5% discount to the company’s last closing price, and a 41.3% discount to the ten-day volume weighted average share price.
Kalium Lakes’ largest shareholder, Greenstone Resources, has committed to take up to A$8-million under the placement, with its share placement falling within the second tranche placement.
Co-founder and director Brent Smoothy has also committed to subscribe for A$2-million under the placement, which is also subject to the company obtaining shareholder approval.
In addition to the placement, Kalium Lakes will offer all of its existing eligible shareholders the opportunity to subscribe for up to a maximum of A$30 000 worth of shares under an SPP, to raise up to an additional A$8-million.
The SPP is subject to shareholder approval, and will open on August 23, and close on September 26.
The capital raising will fund additional working capital during ramp-up of Kalium Lakes’ Beyondie sulphate of potash (SoP) mine, which targets an initial production target run-rate of 80 000 t/y by the first quarter of 2023, and to assist in the expansion of the mine to 120 000 t/y production run-rate, which is targeted to be achieved by the third quarter of 2024.
The additional working capital is primarily required owing to the delayed production profile for Beyondie, on the back of later-stage commissioning issues.
Meanwhile, Kalium Lakes on Thursday said that it has successfully negotiated the terms of a debt restructure with its two senior lenders KfW IPEX-Bank and the Northern Australia Infrastructure Facility to facilitate the expansion to 120 000 t/y.
As part of the debt restructure, the existing royalty holders of the company have also agreed to subordinate and defer the payment of their royalties.
“We are pleased to have successfully undertaken the debt restructure and received firm commitments for the necessary additional equity injection. This places the business in a position to now deliver on the targeted ramp-up profile at Beyondie, commencing with the full restart of the SoP process plant in September,” CEO Len Jubber said.
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