EMED Mining (AIM: EMED) announced it has raised £2.9 million gross through placing 38,170,001 new ordinary shares with Fox-Davies Capital Limited acting as the broker. The money will help the company work on the increasingly important Rio Tinto Mine project in Andalucia and pay off a loan to avoid shareholder dilution.
The placing is still pending approval from the company’s shareholders, which is expected to be passed at an Extraordinary General Meeting the day before the planned admission.
The company is raising funds to expand permitting activities at its Rio Tinto Mine project in Andalucía, Spain and also to pay off the £1.4 million loan with YA Global Investments. The paying off of the loan will help EMED avoid shareholder dilution, which has already been announced.
Upon the admission of the new ordinary shares, the company will have the total of 307 million ordinary shares, while fully-diluted share capital will stay at the level of 519 million shares.
EMED has been working with the local government to get a permit to restart production at the Rio Tinto copper mine.
The mine is estimated to have a JORC-standard resource of 940,000 tonnes of contained copper and a mineable reserve of 585,000 tones of contained copper. The company aims to start production at Rio Tinto Mine in 2010, also noting that two major base metal mines have already been started up in Andalucia over the past 6 months.
EMED noted Andalucia is gaining weight as an international metal supplier in the wake of the doubling of the copper spot price during the past 6 months to USD 2.50/lb.
The shares, issued at 0.25p par value each and an issue price of 7.5p each, are expected to be admitted to trading on AIM on 13 August this year.
EMED’s stock has added 1.5% on the news today.
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