Sandfire launches A$200m raise

18th November 2022 By: Esmarie Iannucci - Creamer Media Senior Deputy Editor: Australasia

PERTH ( – Copper miner Sandfire Resources on Friday launched a A$200-million fully underwritten entitlement offer to repay debt and fund working capital at its Motheo operations, in Botswana.

The ASX-listed company will undertake a 1-for-8.8 accelerated non-renounceable entitlement offer priced at A$4.30 a share, representing a 10.2% discount to Sandfire’s last trading price and a 9.3% discount to its theoretical ex-rights price.

The company is expected to issue 46.6-million new shares under the entitlement offer, representing around 11.4% of its current issued capital.

The entitlement offer will be broken up into an institutional entitlement offer, which is expected to raise A$150-million, and a retail entitlement offer, expected to raise a further A$50-million.

Some A$50-million of the capital raised will be used to repay an outstanding corporate debt facility, with A$60-million used to strengthen balance sheet and provide working capital, while a further A$60-million will go towards growth and exploration projects, including MATSA mine extension drilling and ore reserve growth, Motheo A4 progress and Kalahari copper belt near-mine exploration.

The miner told shareholders on Friday that the entitlement offer would ensure the company was well positioned to execute its growth strategy and had the balance sheet strength and flexibility to continue to pursue its growth objectives across its portfolio. In addition to enhancing financial flexibility, the entitlement offer would also provide additional working capital at Sandfire’s existing operations, where the company was focused on continued operating results at MATSA and delivering the Motheo copper mine, scheduled to begin production in the June quarter of next year.

“Sandfire has a strong and prospective pipeline of growth initiatives, including MATSA extensional drilling, progression of Motheo expansion to 5.2-million tonnes a year through development of A4, and exploration of the extensive Kalahari copper belt holdings,” the company said in a statement.

“While near-term capital commitments are supported by existing cash reserves, the entitlement offer provides additional support to fund these ongoing growth and exploration projects and will also assist in immediately reducing Sandfire’s pro forma gearing to approximately 18%.”