Australian Potash Ltd (ASX:APC) has launched a share purchase plan (SPP) to raise up to $2 million at a price of $0.08 per share, as the company advances its flagship Lake Wells Sulphate of Potash (SOP) Project in WA.
This follows APC’s announcement on November 2 that the company received binding commitments from institutional and sophisticated investors to raise $12 million via a placement of shares at $0.08 per share.
The SPP has been launched to provide all eligible shareholders with the ability to participate in APC’s capital raising.
Indicative timetable.
APC’s SPP entitles each shareholder to purchase up to $30,000 worth of new shares.
The volume weighted average price (VWAP) of APC shares traded on the ASX during the five trading days immediately prior to the announcement date of the SPP was $0.1262, and the price under the offer represents a discount of 36.6% to the VWAP price.
Use of funds
In conjunction with the placement, the SPP is expected to provide the company with additional funds of $2 million before costs, taking the entire capital raising to $14 million before costs.
It is anticipated that the funds raised will be mainly used to progress borefield development activities and associated earthworks at the Lake Wells Sulphate of Potash Project, together with working capital.
Mine development plan
Australian Potash managing director Matt Shackleton said earlier this month: “Our progressive de-risking strategy, when applied to the mineral resource, is to continue developing bores, pump-testing those bores and then reconciling recorded flow rates back to the hydro-model, which is effectively our mine development plan.
“At this point, our schedule indicates we will have approximately 30%- 50% of the production borefield by volume developed through Q1 2022.
“Corporately we remain focused on finalising credit approval processes for the balance of the syndicated, development debt facility.”