Northern Minerals Ltd (ASX:NTU) has raised A$9.98 million in a strongly supported share purchase plan (SPP) with funds for continuing development of the company’s projects and operation of its business centred on the Browns Range Heavy Rare Earth Project in northern WA.
The SPP follows completion of tranche-1 of the company’s total A$22 million placement to various sophisticated investors on April 28, which raised cash proceeds of A$6 million before costs.
This resulted in NTU repaying A$3 million of the amounts owing on the A$7.5 million convertible notes issued on June 26, 2019.
Strong response
The company was very pleased with the strong response to the SPP and received applications above the targeted amount of A$5 million (before costs).
NTU's board decided to accept applications beyond the A$5 million target rather than scale back applications under the SPP.
Funds to progress development
Once subscription funds have cleared, Northern Minerals expects to issue 499.02 million shares, which will rank equally with existing quoted shares from their date of issue, expected to be June 10.
The new shares will be issued at 2 cents each, the same issue price as under the placement.
As well as continuing development of projects and business operations, the funds will be used for expenditure relating to care and maintenance of the Browns Range Pilot Plant and for general working capital purposes.