Lindian Resources Ltd (ASX:LIN) will raise $2 million to pursue the potential acquisition of Rift Valley Resources Developments Limited and its Kangankunde Mining Project in Malawi.
The company has received a binding commitment from a high-net-worth investor to subscribe for 20,000,000 fully paid ordinary shares at $0.10 per share.
Lindian will also issue 10,000,000 options to the investor exercisable at $0.12 per share and expiring three years from the date of issue.
Shares and options under the placement will be issued within the next five days.
Lindian Chairman Asimwe Kabunga said: “We are pleased to have secured this investment at a premium to the company’s current market price, and the confidence that it demonstrates regarding Lindian’s ability to successfully close negotiations regarding the potential acquisition of Rift Valley Resources Developments Limited and its Kangankunde Mining Project in Malawi. Lindian will keep shareholders abreast of future developments in this regard.”
Lindian also expects to secure additional funds from a number of existing option holders who intend to exercise outstanding options into fully paid ordinary shares.
Use of funds
Funds raised from the placement and expected option conversions are expected to put Lindian in a strong position to acquire Rift Valley Resources Developments Limited and its Kangankunde Mining Project in Malawi, following the recent settlement of litigation in the Malawi Supreme Court of Appeal as well as to meet existing working capital requirements.
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