ASX-listed phosphate miner Avenira will raise funds via a share placement to fund the completion of the feasibility study for the Baobab expansion project in Senegal, West Africa.
Avenira has received firm commitments to raise A$2.80 million through a placement of 139.9 million fully paid ordinary shares at a price of $0.02 per share, $2 million of which has been committed by Avenira’s three major shareholders, Agrifos Partners, Tablo Corporation and Agrifields, subject to shareholder approval.
Each of the three shareholders are active participants in the phosphate and agriculture industry and their support is a demonstration of the compelling metrics of the Baobab phosphate project and the favourable outlook for the phosphate rock price.
The placement will be completed in two tranches, with the first 40 million shares issued under the company’s existing 15% capacity. The second tranche of 99.9 million shares will be issued, subject to shareholder approval at a general meeting of shareholders, which is expected to be held in late September 2018.
The funds raised will be used to complete the feasibility study for the Baobab expansion project, as well as for general working capital. The feasibility study is expected to be completed in the fourth quarter this calendar year, with the company planning to initiate a bankable feasibility study phase thereafter.
“The feasibility study underway for the Baobab project considers a major expansion of the existing Gadde Bissik mine and we are keen to develop this project in an environment of increasing global food demand, production yield improvement and population growth,” says Avenira chairman Brett Clark.
“Given recent positive upward market movements in phosphate rock benchmark pricing, we are also planning to review our Wonarah project in Northern Territory which is one of the largest phosphate deposits in Australia and 100%-owned by Avenira,” Clark added.