DISCOVERY METALS TO RAISE $140M
Written on the 18 November 2010
COPPER explorer Discovery Metals Limited (DML) has successfully completed a $51 million share placement to fund its drilling and exploration projects in Botswana, with a rights issue underway for a further $90 million.
Managing director Brad Sampson (pictured) expects the Brisbane-based business to become an ASX 200 lister once the capital raising is completed.
“The share placement is the first part of fund raising for our projects, and there’s a rights issue underway as well as we’re seeking to raise $142 million,” he says.
“That will be the equity component and there will also be a debt component we’re expecting to be US$100 million plus. I’m thrilled. We’ve worked very hard in the last two-and-a-half years to inform investors about what we’re doing and we’ve received an exceptional response from the investment community here, in Singapore, Hong Kong and London.”
Sampson would not reveal any of the major new institutional investors, but highlights a strong contribution from existing investors such as Transamine and Macquarie Bank.
“We have two important parts – one is the Boseto project and at the moment we’ve been doing underground drilling there and published results with high grade thick intersections of mineral deposits,” he says.
“We’ve also got a large land area that’s very prospective and we’re looking at a second project. We’re out looking for multiple projects and if we need the cash we’ll raise the funds needed when we get to it.
“After the rights issue our market capitalisation is going to go up, that’s a reality, and once we have that funding it’s likely we’ll be an ASX 200 company – all things equal, provided we have successful exploration outcomes I think we’ll see a healthy increase in the share price.”
DML shares rose 5.2 per cent today to $1.32.