Koba Resources Eyes 20% Share Increase with $1.14M Entitlement Offer

Capital Raise to Accelerate Uranium Exploration

Koba Resources Limited (ASX, KOB) has launched a non-renounceable pro rata entitlement offer to raise approximately $1.14 million before costs. The offer invites eligible shareholders to subscribe for one new share for every five existing shares held, priced at 3.6 cents per share. Additionally, for every two new shares subscribed, shareholders will receive one attaching option exercisable at 8 cents, expiring on 30 June 2028.

The capital raising is designed to support ongoing exploration activities at the company’s flagship Yarramba Uranium Project in South Australia. This project has recently yielded encouraging results, including three new high-grade uranium discoveries at the Everest, Berber, and Chivas prospects. These findings underscore the potential of the 5,000 square kilometre project area, which lies near the established Honeymoon Uranium Mine.

Strategic Use of Funds and Offer Details

The proceeds from the entitlement offer will be primarily directed towards advancing exploration at Yarramba, with approximately 66% of funds allocated to this purpose. The remainder will cover offer costs and provide working capital to support corporate and operational expenses. The offer is open to shareholders registered by 5pm (WST) on 6 June 2025, with a closing date of 27 June 2025.

Koba’s board, including Managing Director Ben Vallerine, has expressed confidence in the offer, recommending shareholders participate to support the company’s growth trajectory. The directors themselves intend to fully subscribe to their entitlements, signaling their commitment to the project’s advancement.

Capital Structure and Shareholder Impact

Assuming full subscription, the offer will issue approximately 31.7 million new shares, increasing the total shares on issue by around 20%. The company also plans to issue over 15.8 million new options under the offer. Importantly, if all eligible shareholders participate fully, the offer is not expected to alter the control dynamics of the company.

Substantial shareholders such as Havilah Resources Limited, Deck Chair Holdings, and Vista Grove Investments are expected to maintain their relative holdings, provided they participate proportionally. The company has implemented measures to prevent any single shareholder from exceeding a 19.9% voting power threshold as a result of the offer.

Risks and Market Context

The prospectus outlines a comprehensive range of risks associated with the investment, including dilution risks for shareholders who do not participate, sovereign and native title risks, environmental and regulatory challenges specific to uranium mining, and commodity price volatility. The company operates in multiple jurisdictions, including Australia, Canada, and the USA, exposing it to geopolitical and operational risks.

Market conditions, including the evolving geopolitical landscape and uranium price fluctuations, add layers of uncertainty. The offer is not underwritten, which means subscription levels will be critical to the company’s funding plans. Shareholders are advised to carefully consider these factors and consult professional advisers before participating.

Lead Manager and Corporate Governance

Cygnet Capital Pty Limited serves as the lead manager for the offer, receiving fees and options as part of their engagement. The company confirms compliance with continuous disclosure obligations and provides pro-forma financial statements reflecting the anticipated impact of the offer proceeds on its balance sheet.

With recent drilling successes and a clear funding pathway, Koba Resources is positioning itself to advance its uranium exploration ambitions amid a complex but potentially rewarding market environment.