Cullen Resources Limited Announces Rights Issue to Raise $1.14 Million
CUL (CUL) Share Update July 2024 Sunday 21st
Cullen Resources Announces Pro-Rata Rights Issue to Raise $1.14 Million
Cullen Resources Limited (ASX: CUL) has announced a pro-rata, non-renounceable rights issue to raise up to $1.14 million by issuing new shares at a discounted price.
Instant Summary:
- Rights issue to raise up to $1.14 million.
- New shares priced at 0.6c each, a 25% discount to last trading price.
- Shareholders can apply for additional shares beyond their entitlement.
- Funds to be used for exploration and working capital.
- Offer document to be sent to eligible shareholders on 30 July 2024.
Details of the Rights Issue
Cullen Resources Limited (Cullen) has announced a pro-rata, non-renounceable rights issue to raise up to $1,140,346. The company will issue up to 190,057,744 new fully paid ordinary shares on the basis of one new share for every three shares currently on issue. The new shares will be priced at 0.6c each, representing a 25% discount to Cullen's last trading price of 0.8c on 19 July 2024.
Shareholders who are registered with an address in Australia or New Zealand as of 7:00 pm (AEST) on 25 July 2024 will be eligible to participate in the rights issue. The offer also includes the capacity for shareholders to apply for more than their entitlement from the pool of shares not taken up by eligible shareholders. However, there is no guarantee that applicants will receive any additional shares they apply for under this facility.
Use of Funds
The funds raised from the rights issue will be primarily used to advance exploration projects. Specifically, the funds will be allocated for gold, base metals, and Ni-Cu-PGE mineralization at the Wongan Hills Project, gold and lithium exploration at the Barlee Project, and REE, lithium, and/or gold at the Bromus South Project. Additionally, funds will be used for advancing targeting at the Cue and Yornup Project, as well as for project generation and working capital purposes.
Key Dates
The indicative timetable for the rights issue is as follows:
- Announcement of the offer: 22 July 2024
- Record date to determine entitlements: 25 July 2024
- Offer document dispatched to eligible shareholders: 30 July 2024
- Closing date for receipt of acceptance and payment: 16 August 2024
- New shares quoted on a deferred settlement basis: 19 August 2024
- Company to announce results of the offer: 23 August 2024
- Allotment of new shares: 23 August 2024
- Date of quotation of new shares issued under the rights issue: 26 August 2024
The rights issue offers existing shareholders an opportunity to increase their holdings at a discounted price, potentially leading to increased market activity. The funds raised will support Cullen's exploration projects, which could enhance the company's long-term value. However, the dilution of existing shares and the fact that the rights issue is not underwritten may introduce some uncertainty.
Investor Reaction:
Analysts have noted the potential for significant exploration advancements with the raised funds. Investor reaction has been cautiously optimistic, with interest in the discounted share price balanced by concerns over share dilution.
Conclusion:
Investors should consider participating in the rights issue to take advantage of the discounted share price and support Cullen's exploration initiatives. Monitoring the progress of the funded projects will be crucial in assessing the long-term benefits of this capital raise.