Finders Resources’ (ASX:FND, LON:FND) capital placing has received “overwhelming” shareholder support, raising funds for the development of its flagship Wetar copper project in Indonesia.
Shareholders voted in favour of the capital raising at a shareholder meeting held today in Sydney, the group said in a statement to the London Stock Exchange.
Shares moved up nearly 5 percent on the news, and were up at 21.50p in late morning London trade.
The total capital raising amounted to A$20.95 million via a placement to institutional and sophisticated investors. Under the offer, new ordinary shares will be issued at A$0.28 per share, a discount of approximately 10% to the trading price of Finders shares prior to announcement of the raising.
The funds will be applied to the near term development of the Wetar project as well as capital equipment purchases, payment of environmental bonds and relocating the Whim Creek solvent extraction and electrowinning (SX/EW) plant from Australia.
The company will also complete a revised capital estimate for the planned expansion to 23,000 tonnes per annum (tpa) copper cathode.
Finders noted that its shares have traded well above the placing price since it was announced, most recently around A$0.37.
“I believe this shows that the market is beginning to appreciate the future of the company and its long term prospects," said chairman Russell Fountain.
“Finders is one of very few emerging copper plays for Australian investors.
“The robust economics underpinning our Wetar project, combined with the experience of our management and the support of the local Indonesian community, auger well for a healthy and profitable future for the company,” Fountain added.
In its quarterly operations report, Finders noted a solid performance as it moves the Wetar copper project towards commercial production.
During the second quarter to end-June 2010, the company completed upgrades to Wetar’s demonstration plant ahead of schedule.
Finders said that the demonstration plant’s current performance has been steady, with 416 tonnes of ‘Grade A’ cathode being produced in the quarter, equating to 4.6 tonnes of copper per day. The company sold 439 tonnes during the period with an average price of US$7,100 per tonne.
The company is also targeting completion of a scoping study for the gold and silver deposits at its Ojolali gold‐silver project in Sumatra.