Tanami shares drop on finance deal
PERTH (miningweekly.com) - The share prices of ASX-listed Tanami Gold dropped more than 35% on Monday after the company announced that it would look to raise some A$65.3-million through a renounceable entitlement issue.
The issue would be underwritten by Patersons Securities, subject to the company being satisfied with the due diligence process, and Tanami issuing a prospectus.
Tanami said on Monday that the entitlement issue would be made to eligible shareholders at a price of 20c a share, on the basis of five new shares for every four shares held.
The company’s largest shareholder, Allied Properties Resources, has already committed to taking up its entitlement.
The gold miner said that the funds raised by the entitlement issue would be used to repay the company’s current debt to AP Finance in full, and to fund the completion of the definitive feasibility study for its Central Tanami project.
The entitlement issue would also provide additional working capital.
Tanami shares were trading at a low of 25c a share on Monday, down from a high of 52c a share.
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