Rumble Resources Initiates Capital Raising to Fund Exploration Projects
RTR (RTR) Share Update October 2024 Thursday 31st
Rumble Resources Announces A$7.1 Million Capital Raising Initiative
Rumble Resources Limited (ASX: RTR) has announced a strategic capital raising initiative aimed at generating A$7.1 million to fund its exploration and production growth projects.
Instant Summary:
- A$7.1 million to be raised through a two-tranche share placement.
- Tranche 1 to raise A$5.5 million, utilizing existing placement capacity.
- Tranche 2 to raise A$1.6 million, subject to shareholder approval.
- New shares priced at A$0.045, a 19.6% discount to the last closing price.
- Funds to be used for exploration at Western Queen and other projects.
Capital Raising Overview
Rumble Resources Limited has embarked on a capital raising journey with the goal of securing approximately A$7.1 million. This will be achieved through the issuance of up to 157.4 million fully paid ordinary shares in a structured two-tranche placement.
Tranche 1 aims to raise about A$5.5 million through the issuance of approximately 121.6 million shares, leveraging the company's existing placement capacity under ASX Listing Rules 7.1 and 7.1A. Tranche 2 is set to raise A$1.6 million, involving Bain Resources Holdings and its associates, contingent upon shareholder approval at the upcoming Annual General Meeting.
Pricing and Strategic Investment
The new shares will be issued at A$0.045 each, representing a 19.6% discount to the last closing price of A$0.056. Bain Resources Holdings has committed to a cornerstone investment of A$1.6 million in this placement, signaling strong strategic interest.
Use of Funds
The capital raised will support several key initiatives, including exploration at the Western Queen project to expand gold resources, advancing the Western Queen South open pit towards a final investment decision, and progressing other projects like the Earaheedy Zn/Pd/Ag project. Additional funds will be allocated to working capital and covering the costs associated with the offer.
This capital raising is expected to bolster Rumble Resources' financial position, enabling the company to advance its exploration and production projects. The discounted share price may initially impact the stock negatively, but the strategic investments and potential for resource growth could enhance long-term shareholder value.
Investor Reaction:
Analysts are likely to view the capital raising as a necessary step for Rumble Resources to achieve its exploration and production goals. The involvement of Bain Resources Holdings as a cornerstone investor may boost confidence in the company's strategic direction.
Conclusion:
Investors should consider the potential for growth in Rumble Resources' projects and the strategic significance of this capital raising. Monitoring developments at the Western Queen and Earaheedy projects will be crucial for assessing future returns.