JOHANNESBURG (miningweekly.com) – Aim-listed Savannah Resources has raised about £1.3-million to fund work on its Portuguese lithium projects, to advance the Mozambique-based Mutamba joint venture project with mining major Rio Tinto, and to further work on its Oman-based copper-gold projects, as well as for general working capital purposes.

Savannah raised the money by issuing 25-million new ordinary shares at a subscription price of 5.25p a share.

"We are excited that a drilling programme at our Mina do Barroso mining licence, in Portugal, will start in the next few weeks and look forward to providing shareholders with further updates, as appropriate,” said chairperson Matthew King on Monday.

Following the receipt of the gross subscription proceeds, the company will have a pro-forma cash balance of about £2.5-million.

Meanwhile, Savannah noted that, under the share placement, the company’s largest investor, private investment trust Al Marjan, had increased its shareholding to 29.26% with a cash subscription of £520 000.

Moreover, alternative director Manohar Shenoy has subscribed for £200 000 in subscription shares which, when combined with Al Marjan’s holding, will not exceed a total holding of 29.99% of Savannah’s shares.

Also following the recent subscription, CEO David Archer has subscribed to £300 000 in shares in cash, giving him a total holding of 5.65% of the company's total voting rights.

In addition, the company has granted an employee options of over 500 000 ordinary shares in the company worth 1p each.

These share options are being issued to the employee in recognition of his significant contribution towards progressing Savannah's portfolio of development projects in 2017 and as part of the company’s policy of retaining talented personnel.

The options have an exercise price of 6.75p at an exercise period limit of four years – 50% vesting after 12 months of completed service and 50% after 24 months of completed service.

The exercise price represents a premium of 35% of the closing price on July 6.