Xanadu Mines Ltd (ASX:XAM) (TSX:XAM) has received firm commitments from significant shareholders to participate in a pro-rata non-renounceable rights issue aimed at raising up to $3.37 million.
The underwriter to the one for 10 issue of shares at a price of 5.2 cents, Patersons Securities Limited, received firm commitments leading up to the opening date of the issue.
These have come from Asia Capital and Advisors Pte Ltd, CAAF Ltd and Noble Resources International Pte Ltd.
Each are seeking to subscribe for a certain number of new shares.
READ: Xanadu Mines raising up to $3.37 million via rights issue to progress Mongolian projects
Asia Capital and Advisors and CAAF have committed to subscribe for the number of shares required to maintain their percentage holdings in the company following the rights issue.
Noble Resources International Pte Ltd has committed to take up its entitlement in full.
Receipt of these firm commitments was a condition to the underwriter providing the partial underwriting of up to $1.75 million and this has now been satisfied.
Xanadu’s directors intend to take up all or some of their entitlement in the rights issue.
Shares were up more than 10% today to 5.3 cents.
READ: Xanadu Mines has a tier 1 copper asset with a gold bonus: Hunter Capital Advisors
Funds raised will be used to expand the company’s drilling program at the Kharmagtai Copper-Gold Project and for further exploration at the Red Mountain project, both of which are in Mongolia.
Xanadu is in a prime position in southern Mongolia and boasts one of Asia’s largest undeveloped copper deposits, Kharmagtai, topped off by significant gold credits.
READ: Xanadu Mines upbeat about strong copper market fundamentals
Being in the same region as Rio Tinto plc’s (LON:RIO) massive Oyu Tolgoi Copper-Gold Project and adjacent to the world’s biggest copper consumer China are sufficient reasons to make Xanadu a compelling story.