Kefi Minerals’ (LON:KEFI) directors and its major shareholder have heavily backed a US$4mln fund raise by the Ethiopia and Saudi-focused gold group.
Odey Asset Management, the board and other managers are stumping up more than two-thirds of the money being raised through a placing at 0.3p.
Following the share issue, Odey’s stake will rise to just over 26%. Run by billionaire fund manager Crispin Odey, the firm has a reported £8bn of investments under its management.
Mining contractor Ausdrill, which will build the mine for Kefi at Tulu Kapi in Ethiopia, is also subscribing for shares to give it a 4.92% stake.
KEFI needs to arrange financing of US$129mln to complete the construction, of which US$110mln will be gold streaming finance and project debt, it said today.
Ethiopia’s government recently confirmed it would inject between US$15-20mln into Tulu Kapi for an equity stake and money that will pay for new infrastructure.
Talks are underway over finalising the finance package and today’s funding will allow it to assemble the remainder of its preferred financing syndicate, Kefi said.
Contractors have already sent forward-teams to Ethiopia to commence local procurement with the time to first production still estimated at 22 months.
Some of the new money will also fund preparations for a mining licence application at Jibal Qutman in Saudi Arabia.
Harry Anagnostaras-Adams, Kefi’s executive chairman, said he was delighted with the response to the placing.
His stake is diluted to 3.45% , while non–executive Norman Ling increased his stake to 0.43% from 0.17%.
Shares rose 17% to 0.35p.