Hot Chili (ASX:HCH) has successfully closed a $11.3 million private placement with key major shareholders and other sophisticated investors via an offering of unsecured convertible notes.
The funding was led by Sprott Capital Partners along with Taurus Funds Management and Blue Spec Drilling, a company associated with Hot Chili's Chairman, Murray Black.
Hot Chili will use the funds to repay all of its outstanding debt and remove all securities over the company and its subsidiaries.
In addition, the funds will support diamond drilling activities which are progressing well at the company's Productora copper project in Chile.
Hot Chili has already completed the PFS for Productora which contains a resource of 1.5 million tonnes of copper and 1 million ounces of gold, with a 10-year mine life.
The company is currently drill testing the first of several large-scale porphyry copper targets.
Hot Chili’s exploration efforts are focussed on demonstrating additional mine life at Productora, with success likely to result in a material shift in the scale and economics of the project.
At a copper price of US$3 per pound, Productora is already positioned as one of the leading large-scale copper projects in the global development pipeline.
With Hot Chili’s balance sheet now strengthened, the company will be able to fully focus on its growth activities at Productora.