London-listed Blencowe Resources has announced a placing of 18.6-million new ordinary shares to raise £750 000 from three existing shareholders.
The placing was cornerstoned by Jangada Mines, which invested £610 000, increasing its holding in Blencowe from 2% to 9.5%.
Also, Blencowe’s two other largest institutional investors RAB Capital and JUB Capital have subscribed for the remaining £140 000 in the placing, on a pro rata basis, to maintain their respective 10% and 8.2% holdings in the enlarged share capital of the company following the placing.
The funds will be dedicated to fund the delivery of a 100 t bulk sample from the Orom-Cross graphite project, in Uganda, to China and general working capital.
Earlier this month, Blencowe reported an approach from a potential strategic party looking to undertake further off-site testing ahead of potentially providing an offtake and funding solution for the development of Orom-Cross.
This successful capital raise is expected to enable the company to accelerate the bulk sampling plans and build on what it notes were highly encouraging prefeasibility results.
“I am delighted to welcome Jangada Mines as a new significant shareholder in the company. They share our view of the inherent value of Orom-Cross, which has already returned a net present value of $482-million from a fraction of our broader resource.
“I would also like to thank our two major shareholders for their continued support and maintaining their holdings through participation in the placing. At a time when raising capital for junior resource companies remains difficult, we are delighted to have secured funding sufficient to provide working capital for a year at the plc level and also enable us to commence the process to deliver a 100 t bulk sample to our potential strategic partner in China,” comments Blencowe executive chairperson Cameron Pearce.
‘”As we have previously stated, given the substantial disconnect between our market capitalisation and asset value, the focus of the company is to enter into strategic transactions at the asset level for material development, thereby minimising shareholder dilution and capturing a fairer reflection of value.
“The company has previously advised it hopes to execute its first asset level transaction in the current quarter, which is expected to provide sufficient funds to complete the definitive feasibility study. This is running in parallel with the ongoing discussions with our potential strategic partner in China,” he adds.