Magnum to Raise $2.24M via Deeply Discounted Share Issue
Magnum Mining and Exploration has initiated a $2.2 million entitlement offer at a significant discount, aiming to strengthen its capital base and fund key projects in Australia and the US.
- Non-renounceable entitlement offer to raise $2.24 million
- Shares priced at $0.002, significantly below last traded price
- Offer open to eligible Australian and New Zealand shareholders
- Funds targeted for Palmares Project and US exploration
- Includes a shortfall facility for additional share applications
Entitlement Offer Details and Rationale
Magnum Mining and Exploration Limited (ASX – MGU) has announced a non-renounceable pro rata entitlement offer to raise approximately $2.24 million by issuing new shares at a deeply discounted price of $0.002 each. This move is designed to reward long-term shareholders by providing them with priority access to strengthen the company’s capital position. Eligible shareholders in Australia and New Zealand can subscribe to one new share for every share they currently hold as of the record date, June 10, 2025.
The offer is structured to encourage participation by offering shares at a significant discount to the last traded price, reflecting Magnum’s intent to secure committed support from its existing investor base. The company has also included a shortfall facility, allowing shareholders who fully subscribe to their entitlement to apply for additional shares, with any remaining shares potentially offered to third parties at the directors’ discretion.
Use of Funds and Strategic Focus
The capital raised will be directed primarily towards advancing exploration and development activities at the Palmares Project in Australia, as well as supporting the company’s projects in the United States. Additionally, funds will cover the costs associated with the entitlement offer itself and provide general working capital to support ongoing operations. This funding round is a critical step for Magnum as it seeks to maintain momentum in its exploration efforts amid a competitive mining sector.
Magnum’s decision to pursue this capital raising follows an earlier entitlement offer that did not meet its minimum subscription target. The company is currently processing refunds for that previous offer, signaling a renewed effort to engage shareholders with a more attractive pricing strategy and clearer use of proceeds.
Timetable and Next Steps
The offer opened on June 13, 2025, and is scheduled to close on June 24, 2025, with the new shares expected to be quoted on the ASX by July 2, 2025. Shareholders are encouraged to review the prospectus carefully and consider their participation. The company reserves the right to amend the timetable or withdraw the offer if necessary, reflecting the dynamic nature of capital markets and regulatory compliance.
Magnum’s management, including Company Secretary John O’Gorman and Investor Relations representative Evan Smith, have made themselves available for shareholder inquiries, underscoring the company’s commitment to transparency during this capital raising phase.
Bottom Line?
Magnum’s discounted entitlement offer marks a pivotal moment to shore up funds for exploration, but shareholder uptake will be the true test of confidence.
Questions in the middle?
- Will Magnum achieve full subscription given the previous offer’s shortfall?
- How will the significant discount impact share price and shareholder dilution?
- What progress can investors expect on the Palmares Project following this raise?
