Tambourah Metals Faces Dilution Risk as Non-Underwritten Entitlement Offer Opens
Tambourah Metals Ltd has announced a non-renounceable pro-rata entitlement offer to raise approximately $368,000, issuing new shares at $0.02 each with free-attaching options. The capital raise aims to fund exploration projects including Beatty Park Gold and Speewah North.
- Non-renounceable entitlement offer – 1 new share per 8 held at $0.02
- Free-attaching options – 1 option for every 2 new shares subscribed
- Includes Top-Up and Shortfall Offers for additional subscriptions
- Funds targeted for exploration at Beatty Park Gold, Speewah North, and other projects
- Offer closes 23 June 2025; directors intend partial participation
Overview of the Entitlement Offer
Tambourah Metals Ltd (ASX, TMB), a junior gold exploration company, has launched a non-renounceable pro-rata entitlement offer to raise up to approximately $368,000 before costs. Eligible shareholders can subscribe for 1 new share for every 8 shares held as at the record date, priced at 2 cents per share. Additionally, for every 2 new shares subscribed, shareholders will receive 1 free-attaching option exercisable at 4 cents within two years.
Structure and Additional Offers
The offer includes a Top-Up Offer, allowing shareholders who fully subscribe to their entitlement to apply for additional shares not taken up by others, subject to limits and director discretion. Any remaining shares after the Entitlement and Top-Up Offers will be available under a Shortfall Offer, which the company may allocate at its discretion within three months post closing.
Use of Funds and Strategic Focus
Proceeds from the capital raise will primarily fund exploration activities at the Beatty Park Gold and Speewah North projects, as well as other exploration initiatives across Tambourah’s portfolio. The company also plans to allocate funds towards offer costs and general working capital. This targeted funding approach underscores Tambourah’s commitment to advancing its exploration pipeline in Western Australia.
Shareholder Impact and Director Participation
The entitlement offer is non-renounceable, meaning shareholders cannot trade their rights. Those who do not participate risk dilution of their holdings. The company’s largest shareholder group, associated with Executive Chair Rita Brooks, holds approximately 23% of shares and has indicated partial participation in the offer. Directors William Clayton and William Marmion also intend to take up portions of their entitlements.
Risks and Market Context
Tambourah Metals operates in a high-risk sector typical of mineral exploration companies, with risks including funding requirements, exploration success uncertainty, commodity price volatility, and regulatory factors. The company’s financial statements have been prepared on a going concern basis, contingent on successful capital raises such as this offer. The entitlement offer is not underwritten, adding an element of subscription risk.
Next Steps for Investors
The offer opens on 12 June 2025 and closes at 5, 00pm AWST on 23 June 2025, with the company reserving the right to extend or shorten this period. Investors are encouraged to carefully review the prospectus and consider the speculative nature of the investment. The results of the entitlement offer will be announced by 30 June 2025, with new shares expected to commence trading on 1 July 2025.
Bottom Line?
Tambourah’s modest capital raise aims to fuel exploration momentum, but subscription levels and future funding needs remain key watchpoints.
Questions in the middle?
- Will the entitlement offer achieve full subscription given it is not underwritten?
- How will the company prioritize exploration spending if funds raised fall short?
- What impact will director and substantial shareholder participation have on control dynamics?
