Cobalt Blue Holdings Ltd (ASX:COB) aims to raise up to almost $3 million in a Non-Renounceable Rights Issue and subsequent placement with funds to advance the world-class Thackaringa Cobalt Project near Broken Hill.
The company has this week announced a 1 for 6 non-renounceable entitlement issue to shareholders to raise up to $2,491,871.
COB also intends to raise a further $500,000 in a placement.
In this Q&A with Proactive Investors, Cobalt Blue’s CEO Joe Kaderavek comments on the Non-Renounceable Rights Issue.
Proactive Investors: Why are you raising money?
Joe Kaderavek: Our long-term cobalt market view has not changed as we continue to fund the advancement of the world-class Thackaringa Cobalt Project. Thus, project development work continues, indifferent to the current noise of both the equity and cobalt metal markets.
Specifically, we are raising funds for advancing large-scale metallurgical test work programs being undertaken since the completion of the PFS in mid-2018. This includes increasing the scale of the program to a total of 90 tonnes of ore and produce cobalt sulphate and elemental sulphur for marketing assessments.
Efforts will also be focused on planning future exploration activities. This includes reviewing and interpreting historical data of the Thackaringa Cobalt Project as well as the broader Broken Hill region.
Finally, we continue to progress studies that will underpin the operating permits and approvals.
Proactive Investors: What are the key terms/dates of the deal?
Joe Kaderavek: It’s a Non-Renounceable 1 for 6 Entitlement Issue at 12 cents per share to raise $2.49 million. Our board felt that such an offer, at these current prices, should be extended to current shareholders so as to avoid diluting them. We have also asked Blue Ocean Equities, the lead manager and underwriter, to raise up to further $500,000 as a placement.
I’m very happy to announce that the rights issue is fully underwritten, in turn reflecting strong market demand.
Key dates are:
Importantly, please remember that the closing date for entitlements is 5pm AEST on June 3, 2019.
Proactive Investors: Can Investors Top Up?
Joe Kaderavek: Several key shareholders have asked about the ability to top up. I am pleased to confirm, that in the event shareholders do not take up their full entitlements, a top up facility is available for shareholders (who have taken up their rights) to apply for new COB shares additional to their entitlement. However, there is no guarantee additional shares applied for will be received.
Proactive Investors: Coincidently, Cobalt Blue is attending the Cobalt Institute annual conference in Hong Kong – what are your aims?
Joe Kaderavek: Our Executive Manager Dr Andrew Tong is attending the Cobalt Institute global conference on May 15 and 16 in Hong Kong. The conference brings together global market participants in the cobalt production and distribution chain, including producers, traders, customers, and of course, investors. The appetite for long-term cobalt remains strong and COB continues to patiently build our commercial and investment relationships.
Proactive Investors: Thankyou Joe.