Elementos Secures $3 Million Funding for Tin Projects
ELEMENTOS LIMITED (ELT) Share Update August 2024 Thursday 1st
Elementos Raises $3 Million to Advance Tin Projects
Elementos Limited (ASX: ELT) has announced a successful capital raising effort, securing $3 million through a private placement and entitlement offer to advance its tin projects.
Instant Summary:
- Elementos raises A$3.0 million through private placement and entitlement offer.
- Placement priced at $0.095 per share with additional options.
- Chairman Andy Greig commits A$1.5 million, showing strong confidence in the company.
- Funds to be used for Oropesa Tin Project Feasibility Study and other key projects.
- Entitlement offer to eligible shareholders on the same terms as the placement.
Fundraising Details
Elementos Limited has successfully raised A$3.0 million through a combination of private placement and entitlement offer commitments. The placement was priced at $0.095 per share, and participants received one unlisted option for every two new shares issued, exercisable at $0.18 per share by 31 January 2026.
The company's non-executive chairman, Andy Greig, has shown significant confidence in Elementos by committing A$1.5 million, including $1.08 million in the placement and $0.42 million in the entitlement offer. This commitment also settles a A$1.0 million debt facility he had loaned to the company earlier this year.
Use of Funds
The funds raised will be directed towards advancing the Oropesa Tin Project in Spain through its Definitive Feasibility Study, declaring a maiden JORC Ore Reserve, and submitting necessary licenses for the project to become operational. Additionally, the funds will support the exploration program at the Cleveland Tin Project in Tasmania, cover costs associated with the Iberian Smelter Option Agreement, and provide general working capital.
Entitlement Offer
Following the placement, Elementos will conduct a non-renounceable entitlement offer to eligible shareholders, allowing them to purchase one new share for every six existing shares held as of 9 August 2024. The entitlement offer is on the same terms as the placement, with new shares priced at $0.095 and options exercisable at $0.18 per share by 31 January 2026.
The entitlement offer is expected to raise an additional A$3.08 million if fully subscribed, resulting in the issuance of approximately 32.45 million new shares and 16.23 million new options. The offer opens on 14 August 2024 and closes on 13 September 2024.
The successful capital raising effort demonstrates strong investor confidence in Elementos' projects and management. The funds will enable the company to achieve critical milestones, potentially increasing the value of its assets and stock. However, the dilution effect of the new shares and options may temper short-term stock price gains.
Investor Reaction:
Analysts are likely to view the fundraising positively, given the strategic use of funds and the strong commitment from the company's chairman. The market may react favorably to the news, reflecting confidence in Elementos' future prospects.
Conclusion:
Investors should keep an eye on Elementos' progress with its tin projects, particularly the Oropesa Tin Project. The successful completion of the feasibility study and securing necessary permits could significantly enhance the company's value. Participation in the entitlement offer may be an attractive opportunity for existing shareholders.