Extract Resources (ASX, TSX, NSX: EXT) will raise A$60.9 million by issueing 7,299,069 ordinary shares at a price of A$8.35 per share.
The shares will be placed to a 100% owned subsidiary of Kalahari Minerals plc (LON:KAH).
Kalahari’s interest in the company will increase by 1.71% to 107,342,087 shares, representing 42.83% of the 250,601,367 shares on issue.
Along with existing cash balances of approximately A$39.7m, the funds will be used to complete the company’s current drilling programs in Namibia. Extensive exploration potential also exists for new uranium discoveries in the region.
Proceeds will also fund further value engineering and optimisation initiatives in support of the Definitive Feasibility Study on the Husab Uranium Project, allowing initial engineering and pre-development work to commence at the project.
The placement is conditional upon the company and Kalahari entering into a formal subscription agreement.
Completion of the placement is expected to occur on or before 7 January 2011 or within two business days of shareholder approval, if required.