Tempest’s $1.87M Capital Raise Could Dilute Shareholders Amid Exploration Push

Capital Raising to Fuel Growth

Tempest Minerals Ltd (ASX: TEM) has successfully secured firm commitments to raise $400,000 through a placement of 100 million fully paid ordinary shares priced at $0.004 each. Alongside these shares, the company is issuing 25 million free attaching options exercisable at $0.01 each, valid until 31 May 2027. This initial tranche of capital was strongly supported by sophisticated and wholesale investors, signaling confidence in Tempest’s strategic direction.

The placement shares and options are being issued under the company’s existing capacity pursuant to ASX Listing Rules 7.1 and 7.1A, allowing for a swift execution without the need for shareholder approval. Cygnet Capital Pty Ltd managed the placement and will continue to play a pivotal role as lead manager for the forthcoming entitlement issue.

Entitlement Issue to Raise Additional Capital

Following the placement, Tempest plans a non-renounceable entitlement issue aimed at raising approximately $1.469 million before costs. Eligible shareholders will be offered one new share for every two shares held at a price of $0.004 per share, accompanied by one attaching option for every four shares issued. This move is designed to broaden shareholder participation while bolstering the company’s balance sheet to support its exploration and development activities.

The timetable for the entitlement issue is yet to be announced, but Cygnet Capital has been appointed to manage the process and advise on any shortfall placements. As part of their engagement, Cygnet will receive a 6% fee on funds raised and may be granted up to 28 million options, subject to shareholder approval, aligning their interests with Tempest’s growth ambitions.

Strategic Use of Funds

The capital raised will be directed towards advancing Tempest’s gold exploration portfolio in Western Australia and progressing development work at the recently discovered Remorse Iron deposit in the Yalgoo region. These projects represent key pillars of the company’s growth strategy, leveraging the technical expertise of its management team to unlock value from its diversified mineral assets.

Managing Director Don Smith emphasized the importance of the funding, stating that the support from Cygnet Capital and new investors will enable Tempest to accelerate exploration and development efforts. The company’s focus remains on data-driven, risk-weighted exploration to maximise shareholder returns.

Looking Ahead

With the placement completed, attention now turns to the entitlement issue and subsequent exploration milestones. The market will be watching closely for updates on subscription levels and progress at the Remorse Iron deposit, which could materially influence Tempest’s valuation and investor sentiment.

Tempest’s approach to capital raising, combining placements with entitlement offers, reflects a balanced strategy to fund growth while managing dilution. The involvement of Cygnet Capital as lead manager and option holder further underscores the confidence in the company’s prospects.