London-listed Premier African Minerals has launched a retail offer through a bookbuild of new ordinary shares, each with no par value, at an issue price of £0.0275 per share, aiming to raise up to £2.3 million before fees and expenses.
In addition to this retail offer, the company has also conducted a placing of new ordinary shares at the same issue price, with gross proceeds of £1.2 million.
The company clarified that the retail offer and placing are separate initiatives, with the retail offer not being part of the placing. The issue price represents a discount of approximately 30% compared to the closing mid-market price on January 15.
The retail offer is conditional on the new shares being admitted to trading on the London Stock Exchange’s AIM market.
Both the placing and retail offer are interdependent, with the total gross proceeds, alongside the value of any settlement shares issued to creditors accepting shares in lieu of debt, needing to exceed £3.5 million. If the total proceeds fall short of this amount, the fundraising activities will not proceed.
The net proceeds from the fundraising will be used to finance the final commissioning and optimization of the primary flotation plant and to purchase a secondary flotation plant for the Zulu lithium and tantalum project in Zimbabwe.
The company believes these investments are crucial for restarting operations at the project, alongside addressing trade creditors who require immediate settlement to support the initial test run.
Additionally, funds will be allocated for part payments to the Zimbabwean government for deferred VAT and other statutory obligations, amounting to $250,000, as well as arrears of salaries and wages to employees totaling $400,000. Part of the proceeds will also be directed to specific suppliers for plant spares and maintenance, totaling $180,000.
Any remaining balance will be used to make part payments to contractors and other creditors to ensure ongoing commercial operations.
The company has been negotiating with certain creditors to accept new shares as full or partial settlement of outstanding liabilities, with agreements expected once the terms of the placing are finalized.
