Mining investment bank SP Angel says in an updated note on Aim-listed Beowulf Mining that the company is well-funded through to the end of 2027, particularly to deliver a prefeasibility study (PFS) on the Kallak high-grade iron-ore project, in Sweden.

The UK-registered, Nordic-focused exploration and development company secured a strategic investment from Bacchus Capital and affiliates earlier this month, which will raise gross proceeds of £4.3-million. "The investment will, on completion, provide funds for key workstreams through 2027 and a reinforcement of the company's balance sheet following an extended period of uncertainty," SP Angel states.

Upon closing of the deal, Bacchus Capital will hold 59% of Beowulf's enlarged share capital.

Beowulf plans to undertake an infill drill programme to upgrade Kallak's inferred mineral resources to the indicated category, as well as deliver an updated scoping study in advance of the PFS.

The scoping study is expected to have economic improvements compared to a 2023 study.

Alongside progressing Kallak towards PFS, the strategic investment from Bacchus Capital will also support the advancement of the Grafintec graphite anode materials, in Finland, including workstreams to support the submission of an environmental impact assessment on the project.

SP Angel notes the incoming board and management appointments at Beowulf, saying incoming chairperson Peter Bacchus and incoming CFO Shea O'Callaghan will add strong experience in critical minerals and mining development to the board.

For SP Angel, the Kallak project remains a highly strategic asset offering a future supply of high-grade concentrate into the growing European and Middle Eastern green steel markets.

In respect of SP Angel's valuation of Beowulf, Beowulf shares suffered a sharp derating to lows of £0.03 given recent market uncertainty, however, this funding overhang has now been cleared, with the company set to be cashed up on closing of the strategic investment.

"We updated our target price for Beowulf to £0.27 following the issuance of 147-million new shares from the transaction. Our target price is conditional on the proposed investment closing and reflects a net present value of $388-million on the project (after tax).

"Ultimately, Beowulf shares are now too cheap given its robust project portfolio, spearheaded by an increasingly derisked Kallak, and expected strong cash position to fund project advancement through to the end of 2027," SP Angel concludes.