VSA and Drakewood Capital Management have formed a strategic partnership to beef up its presence in the junior mining sector.
Boutique financier Drakewood will invest £405,000 into specialist mining broker VSA, to strengthen its advisory, fundraising and capital services for junior mining companies.
Both VSA and Drakewood believe there is a commodities bull market currently and recognise that junior mining companies have faced difficulties raising capital.
VSA said that the partnership combined with the additional capital subscribed by Drakewood will allow it to attract more junior mining companies as corporate clients, recruit experienced professionals and offer junior mining companies capital for growth opportunities.
Drakewood’s cash injection will be via a subscription for 4.5 million shares at 9p per share, a 50% premium to yesterday’s close.
Following the completion, Drakewood's will own 19.9% of the enlarged company and also have an option over Andrew Monk’s holding in VSA.
Drakewood has also been granted 1.75 million warrants to subscribe for VSA new ordinary shares.
Mark Thompson, a veteran of trading giant Trafigura and private equity group Apollo Management, is also joining the enlarged group's board as a non-executive.