Australian Strategic Materials Ltd (ASX:ASM) has fielded strong support for a share purchase plan (SPP) and as a result has accepted all applications, raising $1.1 million more than the original $10 million target.
The SPP Booklet outlined a target of $10 million from the SPP, however, given the strong support shown by shareholders, the board decided to use its discretion under the terms of the SPP and accept all shareholder applications.
As a result, fully paid ordinary shares were issued today and trading of the new shares on the ASX is expected to begin on or before Wednesday, December 7, 2022.
This takes ASM’s recent total capital-raising proceeds to $41.1 million
“Strong cash position”
ASM CEO Rowena Smith said: “ASM welcomes the positive response from shareholders and thanks all participating shareholders for their ongoing support.
"With the funds received from the SPP and the recent placement, we are now in a strong cash position to support production at the Korean Metals Plant and deliver the offtake and strategic partner work for the Dubbo Project.”
The SPP was announced on November 2, 2022, and closed on November 30, 2022.
Director placement participation
ASM has also completed the placement that raised $30 million, including $4.05 million from directors Ian Gandel and Kerry Gleeson.
The placement was completed with the issue of 2,341,041 fully paid ordinary shares to the two directors after shareholder approval was received at ASM’s Annual General Meeting on November 28, 2022.
Gandel, who is company chair and largest shareholder, and Gleeson, a non-executive director, committed to subscribe for $A4 million and $A50,000 respectively in the placement, demonstrating continued support for the company.
Use of proceeds
Funds raised from the capital raising, together with existing cash and sources of liquidity, will be used to accelerate development of ASM’s Korean Metals Plant (KMP) and its Dubbo Project, with proceeds being applied as follows:
- Secure KMP feedstock inventory to support metals production, and in turn, assist with near-term customer acquisition.
- Accelerate offtake marketing and strategic partner discussions in relation to funding the Dubbo Project.
- Commence early works on road, bridge and rail infrastructure that are important for site access.
- Manage corporate costs, general working capital and costs associated with the capital raising.