PERTH (miningweekly.com) – ASX-listed Nickel Mines has announced a A$364-million equity raising to fund the initial 30% acquisition of the Angel Nickel project, in Indonesia.
Nickel Mines last week announced that it had reached an agreement with partner Shanghai Decent Investment to acquire a 70% interest in the Angel Nickel project for $490-million.
Angel would consist of four rotary kiln electric furnace lines with an annual nameplate capacity of 36 000 t of nickel metal, and would include a 380 MW coal-fired power plant.
Nickel Mines on Wednesday announced plans to undertake a fully underwritten 2-for-22 entitlement offer to raise the A$364-million, with the offer priced at 94c a share, representing a 10% discount to Nickel Mines’ last trading price.
The entitlement offer will result in some 386.9-million new shares being issued, representing approximately 18.2% of Nickel Mines’ existing shares on issue.
The entitlement offer will consist of an institutional component and a retail component, with the institutional component to close on December 3, while the retail component will close on December 18.
Nickel Mines told shareholders on Wednesday that the majority of the funds raised would go towards the acquisition of the first 30% interest in the Angel project, while excess funds will go towards strengthening the balance sheet and additional working capital.
Nickel Mines’ acquisition of a further 40% interest in the Angel project, at a cost of $280-million, is expected to occur no later than the end of December 2021.
Meanwhile, Nickel Mines on Wednesday also announced that an independent expert had deemed the transaction to be both fair and reasonable, saying the advantages of the transaction outweighed the disadvantages.
The independent expert has valued the Angel Nickel project to be worth between $1.4-billion and $1.5-billion, with Nickel Mines’ proposed 70% interest valued at between $1-billion and $1.1-billion.