African Battery Metals PLC (LON:ABM) has announced a refinancing placing and share subscription as it updated on a strategic and operational review.
The exploration firm said it was raising £1mln through the placing and subscription of 200mln new shares at a price of 0.5p each.
READ: ABM to approach its creditors and suppliers with a view to negotiating a settlement of its liabilities
Each share would also have an attached warrant to subscribe for a new share at a price of 1p each with a two-year life to expiry from admission of the refinancing shares to AIM.
ABM said the refinancing would allow it to pay all of its material creditors through a mixture of cash and shares and to become essentially debt free with a “robust” cash position for at least 12 months of operation.
The company said the resolutions for the refinancing would need to be approved at a general meeting, to be held in February, adding that it had already received votes in favour from existing shareholders representing 47.5% of the shares.
Following the passage of the resolutions, ABM also said its chief executive, Roger Murphy, and executive director Matt Wood would step down from the board, while Andrew Bell would be appointed executive chairman and Paul Johnson as executive director.
Both Bell and Johnson had committed to subscribe £50,000 in the refinancing, while Red Rock Resources PLC (LON:RRR), where Bell is a director, had committed to subscribe for £100,000.
ABM said that following the refinancing a full strategic and operational review would be undertaken to ensure corporate costs were “minimised”, exploration opportunities were target in a “prioritised manner”, and new opportunities were considered to “complement and diversify” its interests.
The refinancing marks a bright turnaround from last month, when ABM’s shares were suspended from trading on AIM after the group said it had been unable to secure financing with any of its shareholders.
Roger Murphy, chief executive of ABM, said the further to the December announcement, the company had “been able to negotiate and conclude a business restructuring and refinancing package that enables the Company, subject to shareholder approval at General Meeting, to return to trading on the market”.
ABM’s shares are still suspended on AIM at 1.35p.