Celsius Resources plans to issue additional free-attaching options to investors in its Tranche 2 Placement, aiming to bolster support amid challenging geopolitical and economic conditions. These options, exercisable at a nominal price, await shareholder approval and ASX listing conditions.
- Additional free-attaching options offered on a 1-for-2 basis
- Options exercisable at A$0.01, expiring in three years
- Issuance contingent on shareholder approval and ASX listing conditions
- Directors and Silvercorp Metals, Inc. eligible for options
- Tranche 2 placement securities expected around 16 May 2025
Context of the Placement
Celsius Resources Limited (ASX, AIM: CLA), a mining exploration and development company, has announced an update to its capital raising strategy through the Tranche 2 Placement initially disclosed in March 2025. The company intends to issue additional free-attaching options to investors who participated in this placement, a move designed to maintain investor confidence amid a backdrop of escalating geopolitical tensions and macroeconomic uncertainty.
Details of the Additional Options
The additional options will be granted on a 1-for-2 basis relative to the securities issued in Tranche 2, subject to shareholder approval obtained at the recent general meeting held on 28 April 2025. These options carry an exercise price of A$0.01 and will expire three years from the date of issue. The terms mirror those of the original free-attaching options approved for the Tranche 1 and Tranche 2 participants, ensuring parity among investors.
Strategic Rationale and Market Conditions
The decision to offer these additional options comes after advice from the company’s placement adviser, reflecting a strategic gesture to reward and retain investor support during uncertain times. With global markets facing volatility due to geopolitical risks and economic headwinds, Celsius is proactively enhancing the attractiveness of its capital raising to secure ongoing operational funding and business continuity.
Regulatory and Listing Considerations
The company is preparing a prospectus for the issuance of these options, which will be quoted on the ASX if the exchange’s conditions for admitting a new class of quoted securities are met. Should these conditions not be satisfied, the options will still be issued but remain unquoted. This dual pathway underscores the company’s commitment to flexibility in navigating regulatory requirements while advancing its capital structure.
Insider Participation and Equity Rights
Notably, directors Mark van Kerkwijk and Paul Dudley have participated in Tranche 2 on the same terms as other investors and will also receive the additional options. What's more, Silvercorp Metals, Inc., a strategic equity participant, retains its right to receive these options in line with its prior equity participation agreement. This alignment of interests between management, strategic partners, and investors is a positive signal for market confidence.
Looking Ahead
The issuance of the Tranche 2 placement securities, including the additional options, is anticipated around 16 May 2025. Celsius has committed to providing further updates as the process unfolds, with market participants keenly watching for shareholder approval outcomes and ASX decisions that will ultimately shape the company’s capital raising success.
Bottom Line?
Celsius’s additional options offer a timely incentive to investors, but the final impact hinges on shareholder and ASX approvals.
Questions in the middle?
- Will shareholders approve the issuance of the additional free-attaching options?
- Can Celsius satisfy ASX conditions to have the options quoted, enhancing liquidity?
- How will the additional options affect the company’s capital structure and shareholder dilution?