Elixir Energy Ltd (ASX:EXR, OTC:ELXPF) has received validation of its gas strategy after receiving strong support in an over-subscribed share placement to institutional and sophisticated investors that raised A$6.25 million.
Binding commitments have been received for the issue of 62.5 million new shares at 10 cents per share, which represents a 13% discount to the last close and a 12.7% discount to the 5-day VWAP.
Demand in excess of placement
The capital raising was strongly supported, with demand in excess of the placement size, and has resulted in the introduction of a number of new institutional investors to the company’s register.
Placement participants will also receive one of Elixir’s currently listed options (EXROBs) for every four placement shares issued. These already listed EXROB options have an exercise price of 12 cents and a term expiring on October 17, 2026.
Funds raised will be used to support the next phases of Elixir’s Grandis Gas Project in Queensland’s Taroom Trough.
Taking project to next stages
Elixir’s managing director Neil Young said: “We are pleased to receive this financial support from existing and new investors to fund the final phases of the Daydream-2 program and take forward Project Grandis into its next phases.
“Equipment is mobilizing to the well lease and the commencement of work is now imminent.”
The new capital raised will be deployed in the next phases of the Grandis Project - to deal with potential contingencies that might arise from the imminent multiple-stage stimulation and flow testing program at the Daydream-2 well.
Funds will also position the company for the next phases of Project Grandis – including ordering long lead items for the next well and improving the negotiating position for potential farm-out negotiations post the flow testing phase.
Placement details
The 62.5 million placement shares will be issued under listing rule 7.1 A and the 18,750,000 listed options will be issued under listing rule 7.1.
The new shares are anticipated to be issued on Wednesday, July 31, 2024.
Taylor Collison Limited and Originate Capital Pty Ltd acted as joint lead managers to the placement.