ASX-listed MOD Resources has announced it has welcomed a number of institutional investors onto its share register as a result of a $12 million oversubscribed share placement.
Joint lead managers to the placement were Blue Ocean Equities and Ashanti Capital.
The placement was conducted using MOD Resources’ existing Listing Rule 7.1 placement capacity and the issue price represented a discount of 9.8% to the 15-day VWAP.
The placement, which remains subject to the clearance of funds, is a result of the issue of 255 319 148 fully paid ordinary shares at $0.047 per share to raise $12 million before costs.
MOD Resources has also announced a fully underwritten non-renounceable rights issue entitling shareholders to subscribe for one new share for every 16 shares held at the same issue price as the placement of $0.047 per share to raise approximately $6.3 million.
The rights issue has been fully underwritten by Blue Ocean Equities and will have a record date which allows the investors under the placement to participate in the rights issue.
LIM Advisors, a prominent Hong Kong investment fund, has been contracted to sub-underwrite the rights issue.
Application of funds
The majority of funds raised from the MOD Resources placement and rights issue will be applied to a major expansion of exploration activities along the T3 Dome, T20 Dome and across MOD Resources wider 12 600 km2 of regional holdings.
This will complement the MOD Resources’ current drilling underway designed to advance three resource projects (T3 Pit extension, T3 Underground, T1 Underground) and test the T-Rex exploration target.
Eight drill rigs are operating at T3 and T1 and this number is expected to increase to test other targets.
Starting early in the June quarter MOD Resources plans to commence drilling of high priority targets identified within the extensive T3 Dome area and subsequently in the T20 Dome, 100 km to the west.
“MOD Resources is well funded to complete the T3 Pit feasibility study and conduct a major expansion to the exploration campaign with numerous identified drill ready targets across our vast regional licence holding,” says MOD Resources MD, Julian Hanna.
This coincides with a greatly improved understanding of the geology and potential of the Kalahari copper belt, and the successful application of airborne EM to generate new targets over large areas.